Consumer confidence is at its lowest level in three years.
The Westpac McDermott Miller Consumer Confidence Index fell seven points to 106 in the three months to September.
A reading above 100 indicates more optimists than pessimists.
Westpac senior economist Felix Delbruck said he was not surprised to see consumer confidence come off the boil on the back of a tough few economic months.
Mr Delbruck said people were still modestly optimistic.
"Their attitudes to spending haven't changed that much over the last three months, so this points to retail activity slowing but not grinding to a shuddering halt," he said.
"It will take some time for the developments in the dairy sector and the offshore economy to perkulate through to the domestic economy, so I would not be surprised if consumer confidence weakens further for here."
"But for now, it's a reasonably resilient outcome."