Consumer confidence tumbles in March

Shopping bags, mad, frustratedConsumer confidence has taken a tumble following Treasurer Joe Hockey’s warning that Australians may need to work for much longer.

The latest ANZ Roy Morgan measure of consumer sentiment has fallen to a three month low after the Federal Government’s intergenerational report said early retirement would become less likely during the next 40 years.

News coverage about the long term implications for the federal budget had dented consumer confidence, ANZ chief economist, Warren Hogan, said.

“We suspect that elevated levels of uncertainty about the economic outlook are causing consumers to be unusually sensitive to negative news flow and this is weighing on confidence,” he said on Tuesday.

ANZ’s sentiment index dropped to a three month low of 110.3 points, which is marginally below the barometer’s 25 year average.

Confidence in the economy also fell to historically subdued levels.

Confidence about the economic outlook for the next five years declined 5.9 per cent while sentiment about the economy for the year ahead was down 1.7 per cent.

ANZ blamed concerns about government finances, the federal government’s unpopularity and worries about weak job security and wages for undermining confidence in the economy.

Hogan said negative news about the budget and the economy had often outweighed goods news, like record low interest rates and cheaper petrol.

Around 1000 people were surveyed to gauge consumer confidence during the first week of March.

AAP

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