ANZ-Roy Morgan Consumer Confidence decreases to 108.3

Consumer confidence declined 0.7% last week, driven lower by weakness in financial conditions.

• ‘Current finances’ fell 4% compared to the prior week, while ‘future finances’ declined 5.2% - its second straight weekly loss.
• In contrast to the weakness in financial conditions, confidence in economic conditions rose. ‘Current economic conditions’ gained 2.4%, building on the strong rise of 6.5% in the previous reading. ‘Future economic conditions’ rose 2.7%.
• ‘Time to buy a major household item’ gained 1.7%, after declining for two successive weeks. The four-week moving average for ‘inflation expectations’ was stable at 4%.

ANZ Head of Australian Economics, David Plank, commented:

"A sharp rise in unemployment and underemployment may explain the fall in ANZ Roy-Morgan Australian Consumer Confidence index last week. Overall confidence is up from its recent low, though still well below average. The decline in confidence was due to weakness in the financial conditions subcomponent. It is possible that news about rising labour market has slack has people concerned about their personal finances. Sentiment toward ‘current finances’ is down 7.5% from its early January high, though still a touch above average. In contrast to the weakness in financial conditions, sentiment toward economic conditions was higher. It is still well below that on financial conditions, however, though the gap between the two has narrowed."

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