ANZ-Roy Morgan Australian Consumer Confidence fell 3.3% last week following three consecutive strong reports. The fall was broad based, with views towards current finances leading the pullback.
The current finances sub-index fell a sharp 9.1% to 104.7, partially unwinding gains over the previous three weeks. In comparison, views towards future finances fell a more modest 2.2%, following a 0.2% decline in the week prior. Despite the weekly falls, both sub-indices sit above their long term average.
Households’ pessimism also extended towards the economic outlook. Views around current and future economic conditions dipped 3.6% and 1.3% respectively, though both sub- indices remain elevated compared to recent lows.
Sentiment around the ‘time to buy a household item’ slipped 1% last week following a 7.9% rise over the preceding two weeks. Four week moving average inflation expectations edged up by 0.1% to 4.6%.
ANZ’S HEAD OF AUSTRALIAN ECONOMICS, DAVID PLANK, COMMENTED:
“Last week saw some pullback in confidence after a series of strong reports. Talk of electricity blackouts and a proposed rail strike in Sydney may have weighed on overall sentiment. It is also possible that the New Year return to work was a factor for some.
The sharp fall in sentiment around households’ current finances may reflect a jump in petrol prices across Melbourne and Brisbane amidst an environment of low wage growth. Despite the weekly fall, this sub-index sits well above its long term average, as does the headline index.
Looking past the weekly volatility, we expect sentiment to remain supported by a strong labour market and a solid outlook for economic activity in 2018.”