Six of 11 regions posted an improvement. Aucklanders were the most negative about their region's economic prospects and were becoming more pessimistic, according to the Westpac-McDermott Miller Regional Economic Confidence Index, released yesterday.
Otago rose six points to 31 in June from 25 in March. Southland was down 20 points to 13 in June from 33 and Canterbury was up nine to 31.
Auckland fell 8 points from zero to record the only negative result in the country of -8.
Westpac chief economist Dominick Stephens said most of the increase in Otago was likely due to to record tourism numbers to the province as well as elevated prices for horticultural, dairy and beef products.
Rising house prices in most areas outside of Queenstown, and the recent completion of new hotels in tourism hot spots, were also likely to have supported sentiment.
''As with other affected regions, the spread of the Mycoplasma bovis cattle disease in the region is likely to have weighed heavily on the farming sector.''
The survey also examined consumers on their own economic situation, producing an index summarising responses to questions, including how respondents reviewed their own financial situation, their current willingness to buy a major household item and the outlook for the national economy.
The index for Otago fell sharply, from 121 in March to 110 in June, Mr Stephens said.
''In stark contrast to the previous quarter, most households in the region expect the New Zealand economy to deteriorate over the coming year.
''They are also becoming less confident about their own financial circumstances and this is probably reflected in a lower willingness to purchase large ticket items.''
Reviewing the national index found the largest changes were in rural areas.
Economic confidence in Nelson/Marlborough/West Coast, Bay of Plenty and Northland rose during the June quarter.
The number of households expecting economic conditions to improve fell significantly in the Waikato, Taranaki/Manawatu-Whanganui and Southland.
In the case of Waikato, the region was likely to have experienced some spillover in negativity from neighbouring Auckland, Mr Stephens said.
The spread of Mycoplasma bovis to the major dairy producing region would not have helped.
For Taranaki/Manawatu-Whanganui, confidence had been shaken by the Government's announcement it would stop issuing permits for offshore oil and gas exploration in the region.
Households in Auckland were easily the most pessimistic in the country, Mr Stephens said.
''Most of this has to do with what is happening in the housing market, and, more specifically, what government policy may mean in the future.
''The imminent introduction of a regional fuel tax is unlikely to have helped matters,'' Mr Stephens said.
In contrast, households in Wellington were positive about the future and had been since the new Government came to power last year, Mr Stephens said.
The likelihood of more public sector jobs was seen to have been a key supporter of confidence in Wellington.
Confidence in the future prospects of Canterbury also rose, helped by a strong performance from the hospitality and tourism sector.
Attention will turn this afternoon to the release of the ANZ business confidence index. Markets will be looking for any sign of a rebound.
