Roy Morgan Update February 20, 2024: ALP Support at 52.5%, Consumer Confidence & Business Confidence

In this week's Update, we present the latest data on Primary Voting Intention, Consumer Confidence & Business Confidence.

Welcome to the Roy Morgan Weekly Update.

This week support for the Labor Government was virtually unchanged at 52.5% and ahead of the Coalition on 47.5% on a two-party preferred basis.

If a Federal Election were held now the Albanese government would be returned with a narrow majority the latest Roy Morgan survey shows.

The result is a slight improvement on the 2022 Federal Election (ALP 52.1% cf. 47.9%) and augurs well for Labor at the Dunkley by-election in Victoria on the first weekend in March.

Government Confidence was virtually unchanged this week at 83 - but still low.

Government Confidence is well below the neutral level of 100 at only 83 because only 34% of Australians say the country is heading in the right direction while 51% say the country is heading in the wrong direction.

ANZ-Roy Morgan Consumer Confidence was also virtually unchanged this week at 82.8.

Consumer Confidence has now spent 55 weeks below the level of 85 – the longest time below 85 in the history of the measurement.

Although the Reserve Bank have not increased interest rates since November, the momentum in mortgage stress and cost of living pressures continues unabated – keeping a lid on Consumer Confidence.

In Victoria, Consumer Confidence dropped 5 points to 80.2 – as suggested by Robert Gottliebsen, and prior to the full impact of Taylor Swift’s visit.

However, there was movement in one indicator – which is concerning.

Inflation Expectations were up 0.3% to 5.2% this week.

Australians now expect annual Inflation to be 5.2% over the next two years.

Although there was a jump this week, the longer-term trends show Inflation Expectations have now averaged 5.2% for the last six months, since late August 2023.

The renewed rise in Inflation Expectations this week is unsurprising given the price of petrol.

Average retail petrol prices in Australia have now spent a record 32 weeks (more than seven months) above $1.80 per litre.

Petrol prices did dip early in January but have now spent all of February above $1.90 per litre – indicating a sustained rise as people returned to work after the holiday period – and people are noticing the increased prices.

And finally this week we turn to the business community with a look at sentiment in the business world.

Roy Morgan’s Business Confidence for January shows the index rising for a second straight month – up 2.1 points to 93.2 – its highest for six months, since August 2023 – but still well below neutral.

Roy Morgan interviews around 1,500 businesses each month and business confidence has now spent a record twelve straight months under the neutral level of 100.

For context, the 15 year average for Business Confidence is 111.

The back-to-back increases to Business Confidence in December and January are the first time the index has improved in two consecutive months since early last year.

However, the impetus for the increase in January was improved views about the performance of the Australian economy over the next year and next five years – although both indicators remain low.

Businesses are generally positive about their own performance going forward – 42.3% of businesses expect to be ‘better off’ financially this time next year compared to only 25% that expect to be ‘worse off’.

Over the last two months of December and January only seven industries had Business Confidence in positive territory above the neutral level of 100:

Community Services, Accommodation & Food Services, Education & Training, Administration & Support Services, Professional, Scientific & Technical Services, Electricity, gas & water and Recreation & Personal – many Government related industries.

The most confident industry was Community Services with a Business Confidence of 112.7 just ahead of Accommodation & Food Services on 112.6.

At the other end of the scale it is Transport, Postal & Warehousing that has clearly the lowest Business Confidence at only 64.6.

Other industries with below average Business Confidence to start 2024 include Agriculture, Manufacturing, Construction and Property & Business Services.