ANZ-Roy Morgan Consumer Confidence down 1.7 pts to 89.0 driven by falls in Melbourne and Sydney

ANZ-Roy Morgan Consumer Confidence dropped 1.7pts to 89.0 this week – and is now at its lowest for three months since April 25/26, 2020 (85.0). Consumer Confidence is now 29.5pts lower than a year ago on the comparable weekend of July 27/28, 2019 (118.5) and 5.6pts below the 2020 weekly average of 94.6.

Driving the fall this week was a decline in confidence that now is a ‘good time to buy’ major household items and smaller declines across other parts of the index.

Current financial conditions

• Now 25% (up 2ppts) of Australians say their families are ‘better off’ financially than this time last year and 36% (up 2ppts) say their families are ‘worse off’ financially.

Future financial conditions

• In addition 32% (unchanged) of Australians expect their family to be ‘better off’ financially this time next year compared to 21% (up 1ppt) that expect to be ‘worse off’ financially.

Current economic conditions

• However just 7% (unchanged) expect ‘good times’ for the Australian economy over the next 12 months while 50% (up 1ppt), expect ‘bad times’ (the highest figure for this indicator for over three months since April 18/19, 2020).

Future financial conditions

• In the longer term, 19% (up 1ppt) of Australians are expecting ‘good times’ for the Australian economy over the next five years compared to 23% (up 2ppts) expecting ‘bad times’ (the highest figure for this indicator for three months since April 25/26, 2020).

Time to buy a major household item

• A decreasing number of Australians, 31% (down 4ppts), say now is a ‘good time to buy’ major household items, while 39% (up 1ppt), say now is a ‘bad time to buy’.

ANZ Head of Australian Economics, David Plank, commented:

"Confidence continues to deteriorate, with the fifth straight decline. Sentiment has dropped almost 10% from its high at the end of May. The rise in pandemic related deaths in Victoria and new case numbers rising in Sydney seem to be sapping confidence. The reductions in the Jobkeeper and Jobseeker payments from the end of September may have also weighed, with ‘Current economic conditions’ falling sharply and the improvement in ‘Current finances’ stalling at a low level. Inflation expectations rose again, with the four week moving average at its highest level since mid-May. This lift comes just ahead of the Q2 CPI data, which is likely to show the biggest ever fall in headline inflation."

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