This weekly ANZ-Roy Morgan Consumer Confidence Rating is based on 1,005 face-to-face interviews conducted Australia-wide with men and women aged 14 and over last weekend May 13/14, 2017.
The latest headline ANZ-Roy Morgan Australian Consumer Confidence index dropped sharply, falling 2.6% this week. The index now sits at 109.4 – the lowest level since September 2015. The four week moving average continued to trend lower, and is now 1.6% below its long run average.
ANZ’s Senior Economist, Jo Masters, commented:
- Four of the five indices registered sharp declines. Households’ expectations towards their long term economic conditions posted the sharpest fall, down 5.5% over the week. This offset the previous two consecutive weekly gains. Views about current economic conditions fell by 3.9%, but remain slightly above April’s low.
- Households’ views towards consumer’s finances turned pessimistic, with the current conditions index dropping by 3.2% and the future conditions index down by 4.0% from the previous week. Both indices were below their long term trend last week. The four week moving average for confidence about current finances does, however, remain above the long run average.
- The ‘good time to buy a household item’ was the only sub index to rise, up 2.5% and reversing losses from the previous four weeks.
“This week’s sharp fall in consumer sentiment follows two weeks of relatively stable readings. It is possible that the sharp falls in confidence around personal finances reflect last week’s Commonwealth Budget. Some measures, such as schools funding and the First Home Super Saver Scheme went some way to addressing the issue of fairness; but consumers appear to be responding to the big changes in the budget that will hit their hip pockets, such as the proposed 0.5 percentage point increase in the Medicare levy in two years’ time. The latest Fairfax-Ipsos poll, taken late last week, showed that 50% of respondents felt they would be worse off as a result of Budget measures.
"Consumers may be more sensitive about their finances in an environment where house price growth is expected to moderate and low wage growth is viewed as increasingly endemic. We expect wage data tomorrow to show private sector wage growth of just 1.7% in the year to the March quarter, a record low.”
Budget tax increases will always lead to a lower Consumer Confidence explains Gary Morgan, Executive Chairman, Roy Morgan Research.
"This week’s drop in Consumer Confidence follows the Federal Budget considered by many conservatives to be “Labor-lite” and considered by those on the left to be unfair on low income earners. The Turnbull Government chose to increase taxes on consumers – by increasing the Medicare levy – rather than cutting spending; and to increase taxes on Australia’s largest banks, which could lower their share prices and lead to the banks increasing interest rates on the loans they provide to consumers and businesses alike.
"The budget was followed by decreases in four out of the five indices that comprise Consumer Confidence. Household financial expectations compared to a year ago dropped a net 3.2ppts, expectations for the Australian economy over the next year dropped by a net 3.9ppts and expectations for the Australian economy over the next five years dropped a net 5.5ppts. The only increase recorded was in the number of people saying now is a good time to buy."
Click to view the PDF of the latest ANZ-Roy Morgan Weekly Consumer Confidence Release.
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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.
The week that was May 8 - 14, 2017
Macron defeats Le Pen in French Presidential election
- A senior North Korean diplomat who handles the reclusive country's US affairs has said Pyongyang would have dialogue with the US administration if conditions are right, South Korea's Yonhap news agency has reported.
Unemployed people will be immediately cut off from welfare payments if they do not accept "suitable work", Human Services Minister Alan Tudge says.
The Federal Government's full company tax plan will cost the budget more than $15 billion per year once fully implemented, Treasurer Scott Morrison reveals in Parliament.
Health sector backs lifting of Medicare rebate, mental health spending
Budget reflects radical overhaul in Coalition thinking
Australians to pay more tax, banks slugged with billions in fees