Consumer confidence: back on track
ANZ-Roy Morgan Australian Consumer Confidence returned to an upward trend after a drop last week, rising 1.3% in the latest release. Results were mixed at a disaggregated level, with three out of five sub components showing an increase.
Consumers grew more optimistic about both current and future economic conditions, with the indices rising by 4.0% and 4.2% respectively. Both series reversed losses from last week and are sitting comfortably above their long term averages. Indeed, sentiment toward future economic conditions is the highest since late 2013.
Views towards financial conditions were mixed, with the current sub-index extending its losses from last week, falling a further 1.6% to 103, while future finances rose slightly by 0.5% to 126.8 after two consecutive weekly falls.
Sentiment around the ‘time to buy a household item’ saw its second consecutive weekly fall, slipping 0.4% to 141.3. Four week moving average inflation expectations edged down to 4.4%.
ANZ’S HEAD OF AUSTRALIAN ECONOMICS, DAVID PLANK, COMMENTED:
“There was little domestic news of note last week – though the fact that Sydney’s planned rail strike was averted by court action may have helped boost overall sentiment a little. A jump in petrol prices in Melbourne and Sydney may have played a part in dampening households’ views towards current financial conditions.
Encouragingly consumer confidence has sustained the bulk of its January gains, potentially setting up 2018 for a solid start in terms of consumer spending. Next week, we’ll find out how December retail sales went, along with the fourth quarter as whole. The strength of retail sales in October and November, especially, means that the quarterly result will almost certainly be quite solid after the weak Q3 result. We would not be surprised to see December month retail sales post a small decline after the very strong result for November, however.”
