Press Office

Auckland, 10 July 2007 - New Zealanders are feeling increasingly positive about their quality of life, but are concerned about their country’s economic health, according to the latest MasterIndex™ of Consumer Confidence, released today by MasterCard Worldwide.

Overall, the six-monthly index reveals that Kiwis are feeling less optimistic about what the next six months hold compared to how they felt earlier this year, with a MasterIndex score of 57.1, compared to 61.0 in the last round of research. They are, however, much more optimistic than a year ago (45.2).

The research analyses prevailing consumer perceptions of economic conditions for the six-month period ahead and has been conducted across the Asia/Pacific region for 14 years.

Kiwis remain confident about regular income with a MasterIndex score of 80.2, down slightly from 84.3 six months ago. They are also feeling optimistic about the prospects for the country’s stockmarket over the next six months, with a score of 61.3, up from 55.2 for the previous period. They are feeling better about upcoming prospects for quality of life with a score of 43.1, up nearly 20 points since the last MasterIndex survey, although this still remains in the pessimistic range.

In terms of the economy, however, they are feeling less confident (48.3 vs. 51.0 six months ago). Sentiments on employment, which measured at 52.7 compared to 61.0 six months ago, have also slipped.

In sharp contrast is the fact that Australians’ love affair with their nation has returned with the Australian MasterIndex score up 13 points. Australia scored 68.3 compared to 45.3 six months ago.

Consumer confidence in the Asia/Pacific region as a whole however has been improving steadily for the past few years with the regional score for the 13 markets surveyed sitting at 67.9 rising from six months ago (64.3) and a year ago (57.4). It is also above the Historical Average of 59.5.

Australia and Malaysia showed the biggest jumps in levels of consumer confidence while Vietnam (91.3) once again topped the 13 Asia/Pacific markets as the most buoyant in consumer sentiments for the six months ahead.

"The last six months have been punctuated by rising interest rates and ever-increasing residential property prices, coupled with the high Kiwi dollar and weak economic growth which seems to have taken its toll on New Zealanders’ sense of confidence," said Dr. Yuwa Hedrick-Wong, economic advisor, Asia/Pacific, MasterCard Worldwide. "New Zealanders optimism was high earlier this year despite the continual hike in interest rates but it seems factors such as the rising NZ dollar and the impact this is having on the economy are taking their toll."

Dr. Hedrick-Wong said that from a regional point of view China’s continued strong GDP growth and its emerging role as the "growth engine" for the region has contributed to the rise in consumer confidence.

"Consumer confidence in the region is very bullish on the whole, especially because of China’s continued strong growth. However consumer sentiments may be affected in the future by some near term factors around the world such as potentially higher inflation, slower growth in the US, and rising geo-political tension," added Dr. Hedrick-Wong.

The latest MasterIndex survey, the region’s most comprehensive and longest running consumer confidence survey, was conducted from 2 May to 31 May 2007 and involved 5,407 consumers across 13 key Asia/Pacific markets. In its fourteenth year, the bi-yearly survey analyzes prevailing consumer perceptions of economic conditions for the six-month period ahead. The scores ranging between 0 and 100 are based on responses on five variables: employment, economy, regular income, stock market and quality of life.

Other highlights of the latest MasterIndex of Consumer Confidence survey are:

• Australia’s current MasterIndex score of 68.3 is significantly higher than six months ago (45.3), a year ago (46.5) and the market historical average (56.1). Consumer sentiments in this market are at its highest level since 2004 and are the fourth highest in the 29 surveys since the Index was launched 1993. Another notable achievement is, this is the first time in the last five studies (since 4Q 2004) and the seventh time in the last 15 years of the MasterIndex that consumers are optimistic on all five economic factors (Employment 63.7, Economy 68.8, Regular Income 74.5, Stock Market 75.8 and Quality of Life 58.7
• Hong Kong (84.7), China (84.0) and Singapore (83.3) all registered high levels of consumer confidence. Hong Kong and China continue their streaks of high optimism that began in 4Q 2003 and 1999 respectively. Singapore meanwhile has become even more optimistic in the past year or two. Consumers in these 3 markets are very to highly optimistic on all five economic factors.
• Korea (48.5) is more optimistic compared to the last survey (29.3). However, the current MasterIndex suggests that consumers are still cautious about the next six months. Despite optimistic sentiments on the stock market (70.2), and a slightly optimistic outlook on regular income (58.6), dampened sentiment on employment (31.6) and the economy (39.9) continue to weigh down its MasterIndex score.
• Thailand (36.7) is one of the poorest performers in the MasterIndex and is shrouded in mostly deep pessimistic consumer sentiments. A big contributor to this is the general dissatisfaction in Thailand with the interim military government over the long wait for general elections to be held. The introduction of capital control measures had also adversely affected investment and the local stock market.

More information on MasterIndex can be found at the website www.masterintelligence.com

The MasterCard MasterIndex™ of Consumer Confidence survey has a 14-year track record of consumer confidence indices collected from more than 131,000 interviews, unequalled both in scope and history across Asia/Pacific.

The MasterIndex of Consumer Confidence is the most comprehensive and longest running survey of its kind in the region. It has demonstrated its precision at several important junctures as a barometer of consumer sentiment. In June 1997, MasterIndex revealed a decline in consumer confidence – one month prior to the devaluation of the Thai baht that triggered the regional financial crisis. More recently in June 2003, MasterIndex for employment in Hong Kong dropped to a low of 20.0. This was subsequently reflected in Hong Kong’s unemployment rate, which peaked just before Sept 2003 at 8%.

The survey began in Quarter 2 of 1993 and has been conducted twice yearly since. Thirteen markets participate in the survey: Australia, China, Hong Kong, Indonesia, Japan, Korea, Malaysia, New Zealand, Philippines, Singapore, Taiwan, Thailand and Vietnam. Vietnam made its debut in the December 2003 report, replacing India, which is now covered by the SAMEA (South Asia/Middle East/Africa) MasterIndex survey. The last Asia/Pacific MasterIndex survey was conducted from 11 October to 30 October 2006 among a sample of approximately 400 (total sample of 5,405) across the middle and upper income groups in each market, except in China where approximately 600 respondents were surveyed.

The MasterIndex is calculated based upon percentage response figures, with zero as the most pessimistic, 100 as most optimistic and 50 as neutral. Five economic factors are measured: employment, the economy, regular income, stock market and quality of life. The responses are consumers' thoughts on the six months ahead (i.e. January to June 2006). Data collection was via personal and telephone interviews with the questionnaire translated to the local language wherever appropriate and necessary. The survey has a margin of sampling error of plus or minus four percentage points at the 90% confidence level.

The chart on page 5 shows the performance of each market at different key intervals and important turning points in the history of the MasterIndex of Consumer Confidence.

MasterCard Worldwide advances global commerce by providing a critical economic link among financial institutions, businesses, cardholders and merchants worldwide. As a franchisor, processor and advisor, MasterCard develops and markets payment solutions, processes over 16 billion transactions each year, and provides industry-leading analysis and consulting services to financial institution customers and merchants. Through its family of brands, including MasterCard®, Maestro® and Cirrus®, MasterCard serves consumers and businesses in more than 210 countries and territories. For more information go to http://www.mastercard.com.

Statements in this press release which are not historical facts, including any statements about MasterCard's plans, strategies, beliefs and expectations, are forward-looking and subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements speak only as of the date they are made. Accordingly, except for the company's ongoing obligations under the U.S. federal securities laws, the company does not intend to update or otherwise revise the forward-looking information to reflect actual results of operations, changes in financial condition, changes in estimates, expectations or assumptions, changes in general economic or industry conditions or other circumstances arising and/or existing since the preparation of this press release or to reflect the occurrence of any unanticipated events. Actual results may differ materially from such forward-looking statements for a number of reasons, including those set forth in the company's filings with the Securities and Exchange Commission (SEC), including the company's Annual Report on Form 10-K for the year ended December 31, 2006 and Current Reports on Form 8-K that it has filed with the SEC during 2007, as well as reasons including difficulties, delays or the inability of the company to achieve its strategic initiatives. Factors other than those listed above could also cause the company's results to differ materially from expected results.

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Note: The Crisis period in the chart above is based on the reflection of the MasterIndex™ of Consumer Confidence results, which may or may not coincide with actual chronology or the definitions of others.

Historical Average is the mean average of all MasterIndex scores up through Period Ago but not including the Current Period.

* The average excludes Vietnam as this market was not surveyed in 1997/98.