Consumer confidence has plummeted in March - and with the country still in early days of lockdown, conditions are only expected to get worse.
The latest ANZ-Roy Morgan Consumer Confidence Index shows that confidence fell by 16 points, to 106.
As an indication of retail spend, a net 16 percent of people think that now is a good time to make a major purchase, down from 41 percent. The data, which is based on the month up to COVID-19 alert level two, showed a spike in demand for second freezers, computer equipment and home entertainment systems.
ANZ Chief Economist Sharon Zollner said that even if people wanted to spend, most are unable to do so. She expects to see a significant drop in household spending, while people earning usual incomes would save more.
"Consumers usually only feel the impact of global shocks with a long lag, but this one has come rushing to their door at bewildering speed," Zollner said.
Perceptions about the economic outlook for the year ahead - a measure which reflects business confidence - dropped 42 points, with a net 39 percent expecting things to get worse - the weakest outlook since March 2009.
Consumers perceptions of their own financial situation fell slightly in March and a net 12 percent said they felt in a stronger financial position than a year ago.
A month ago, the housing market had picked up, job opportunities were steady and low interest rates provided a solid outlook. But times have changed rapidly and next month's results will provide a truer picture.
"There was a sharp hit in the desire to spend, despite house price expectations still holding up, but with households now in lockdown and non-essential businesses closed, the hit to retail is obviously going to be much, much larger than this," Zollner added.
Looking ahead, a net 17 percent of households expect to be in a better financial position in March 2021, down 15 points.
Consumer perceptions of the five-year outlook rose 5 points, to net 25 percent.
Expectations for house price inflation fell from 5.6 percent to 4.6 percent, with Auckland the only centre expected to lift.
Inflation expectations give retailers an indication of leeway to put prices up or keep them low. In March, that figure dropped 0.4 points to 3.4 percent.
Throughout the COVID-19 lockdown period, with only essential businesses remaining open, consumer spending and confidence is expected to drop.
"COVID-19 is the everyone, everywhere, everything, all-at-once shock, and we are going to get economic data the likes of which we have never seen," Zollner added.