Consumer confidence bounces back
The ANZ-Roy Morgan Australian Consumer Confidence Survey shows sentiment rose 0.9 per cent to 118.1 in the week ending January 22, well above the 100-point level delineating confidence and pessimism.
ANZ senior economist Jo Masters said the resilience of confidence amid global political uncertainty was encouraging.
“In particular, sentiment around current financial and economic conditions has improved significantly since the sharp drop in the wake of the weak Q3 GDP report,” said Masters.
“Importantly, households’ views of overall financial conditions as well as the ‘time to buy a household item’ index remain above their long term trends, suggesting a positive outlook for consumer spending.
“Inflation expectations ticked down last week, following the weaker-than-expected Q4 CPI report. Higher petrol prices have likely pushed inflation expectations up over recent weeks, but with last week’s CPI report suggesting that inflation is unlikely to turnaround sharply any time soon, we expect some of the recent rise in inflation expectations may be unwound.”
After posting a 1.9 per cent fall last week, the rise in consumer confidence was primarily driven by a bounce in confidence in current financial and economic conditions according to the index.
Households’ views towards their current finances rose 3.4 per cent, while views towards future finances were broadly flat (+0.2 per cent).
The post-Christmas bounce in household views on whether ‘now is a good time to buy a household item’ continued to unwind, with the sub-index down 0.4 per cent in the week.
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