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ANZ-Roy Morgan Australian Consumer Confidence faces uphill battle - now at 110.0

This weekly ANZ-Roy Morgan Consumer Confidence Rating is based on 883 face-to-face interviews conducted Australia-wide with men and women aged 14 and over last weekend October 3/4, 2015.
ANZ-Roy Morgan Australian Consumer Confidence declined 0.5% to 110.0 this week. This takes the cumulative fall over the last fortnight to 3.9%, which retraces almost half of the record bounce in response to the appointment of Malcolm Turnbull as Prime Minister.

  • Results across the sub-indices were mixed. Confidence in the economic outlook over the next five years fell 5.6% last week and remains well-below average. In addition, views on household finances compared to a year ago declined 3.6% to the lowest level since mid-June.

  • A sharp rise in ‘time to buy a major household item’ (+6.5%) provided some partial offset. However, this bounce comes after the sub-index reached the lowest level since May 2009 in the previous week. The recent weakness may reflect a softening housing market.
ANZ Co-Head of Australian Economics Felicity Emmett commented:
“The new Prime Minister, Malcolm Turnbull, faces an uphill battle to resurrect confidence in the economy. The new government is taking charge at a time when global financial market volatility and early signs of a softening housing market is adding to the existing woes of the household sector, including weak income growth and high household debt.

"As such, it will be difficult for the new government to engineer a sustained cyclical uplift in confidence. The problems facing the economy are structural and include a well-known reliance on mining and a high cost base. The new government can support a structural realignment of the economy through productivity-enhancing reform. In the absence of outright stimulus, however, it can do little to support activity in the short-term.

"Hence, confidence is likely to remain under pressure over the coming months, with an easing housing market likely to increasingly dominate newsflow and sentiment.”

Gary Morgan, Executive Chairman, Roy Morgan Research, said:

“ANZ-Roy Morgan Consumer Confidence rose strongly the week Malcolm Turnbull replaced former Prime Minister Tony Abbott via a vote of the Liberal party-room - won by Turnbull 54-44 over Abbott - up a one week record 9.2pts to 114.5.

"However, over the last two weeks Consumer Confidence has fallen back to 110.0 (down 3.5pts in a fortnight) following the initial excitement for Australians after removing an unpopular Prime Minister consumers are now turning a critical eye towards Turnbull and just what policies he will implement to strengthen the Australian economy and increase growth and employment.

"As I said yesterday in the Morgan Poll Federal voting release and also the Roy Morgan September unemployment estimate releaseTurnbull’s key priority must be to dismantle the ‘cash economy’ and wage rorting that occurs throughout Australian businesses.

"The recent wage sham and payroll falsification that has led to gross under-payment of employees revealed at 7- Eleven and others is only the ‘tip of the iceberg’. There’s no doubt the Federal Government, Opposition and Unions need to immediately address the systemic under-payment of workers using both legal and illegal methods or just paying them cash.

“New Treasurer Scott Morrison’s claim that weekend penalty rates will be an election issue is misguided. The situation is much more complex. Today employers, relying on the ‘Better Off Overall Test’, are already able to reduce weekend penalty rates in collective agreements so long as the Fair Work Commission has approved such an agreement. This has happened on many occasions, and as a result, many employees have already been disadvantaged under these Fair Work Commission approved Agreements. If the Fair Work Commission does not approve an agreement to reduce penalty rates, the employer must either pay the penalty rates (eg Public Service) or may resort to paying employees lesser amounts in cash. Much has yet to surface about governance and the regulatory environment in which these crucial approval negotiations take place, the role of unions, if any, and the degree of scrutiny and oversight the negotiations and agreements are subject to.

"The negative multiplier impact of the ‘cash economy’ has not yet been quantified by the Federal Government or the Productivity Commission – but it clearly impacts on the Australian economy:

Taxes not being paid by those in the ‘cash economy’

Centrelink benefits claimed by some in the ‘cash economy’ (because they don’t declare their earnings);

Unfair competition for companies paying correct wages who can’t compete;

Companies operating in the ‘cash economy’ obviously need to ‘deal in cash’ – so company tax is lost to the Australian economy;

“The ultimate measure of the success of the Turnbull Government at next year’s Federal Election will be how much they have reduced Australia’s real unemployment and under-employment – not rely on any change in the incomplete ABS unemployment estimate. Released yesterday the latest Roy Morgan September unemployment (8.3% - 1.06 million) and under-employment (7.3% - 936,000) show there are still 1.99 million Australians (15.6%) looking for a job or looking for a new job.”

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ANZ-Roy Morgan Australian Consumer Confidence Rating - October 6, 2015 - 110.0

ANZ-Roy Morgan Australian Consumer Confidence Rating - October 6, 2015 - 110.0

ANZ-Roy Morgan Australian Consumer Confidence Rating - October 6, 2015 - 110.0

Click to view the PDF of the ANZ-Roy Morgan Weekly Consumer Confidence Release.

Latest ANZ-Roy Morgan Consumer Confidence Releases

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Related Research Reports

The latest Roy Morgan Consumer Confidence Monthly Report is available on the Roy Morgan Online Store. It provides demographic breakdowns for Age, Sex, State, Region (Capital Cities/ Country), Generations, Lifecycle, Socio-Economic Scale, Work Status, Occupation, Home Ownership, Voting Intention, Roy Morgan Value Segments and more.

You can also view our monitor of Monthly Australian Unemployment & Under-employment Estimates.