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Consumer confidence: in a holding pattern

• ANZ-Roy Morgan Australian Consumer Confidence retraced last week’s gain, declining 1.0% but remaining above the long-run average by some margin.

• Financial conditions subindices were down with current financial conditions declining 0.9% and future financial conditions taking a bigger hit of 5.3%. This only took future financial conditions down to around the long-run average, however.

• Economic conditions were mixed, with current economic conditions falling 1.6% while future economic conditions gained 0.5%.

• The ‘time to buy a household item’ moved higher for the second week, gaining 2.9%. Four week moving average inflation expectations were stable at 4%.

ANZ’s Head of Australian Economics, David Plank, commented:

“Confidence took a U-turn by falling 1.0% last week. The fall was somewhat surprising considering strong employment growth and reasonable wage data. The turn to a more negative outlook by one of the major Australian banks and news stories about a ban on Australian coal imports by Chinese port authorities that were then denied by authorities may have offset the positive economic data. Consumer confidence has effectively been in a holding pattern over the past three weeks, though the important thing to note is that it has remained above the long-run average.”



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