Oct 27, 2020
Consumer confidence lifts again - just
Bolstered by the gains in ‘economic conditions’, consumer confidence gained 0.2 per cent last week. This was the indexes' ninth gain in a row.
The modest overall gain came despite the sharp 6.2 per cent decline in ‘current financial conditions’. ‘Future financial conditions’ gained 1.3 per cent.
‘Current economic conditions’ lifted by a significant margin of 8.4 per cent, its fourth-straight weekly increase, while ‘future economic conditions’ rose 0.7 per cent.
‘Time to buy a household item’ declined 1.9 per cent, after three straight weeks of gains. The four-week moving average of ‘inflation expectations’ remained stable at 3.4 per cent while the weekly reading rebounded sharply to 3.6 per cent after the sharp fall to 3 per cent last week.
"Confidence gained for the ninth straight week and is now close to neutral, its highest level since the pandemic induced collapse in confidence in mid-March.," ANZ Head of Australian Economics, David Plank said.
"The details suggest some caution about the result, however. ‘Current financial conditions’ fell by more than 6 per cent – its biggest weekly decline since the extreme weakness seen in March."
"This may be a sign that the cutbacks in the JobKeeper and JobSeeker payments are starting to be felt. The sub-indices can be volatile from week-to-week, as evidenced by the jump in inflation expectations after the plunge the week before, so we need to be cautious about reading too much into the drop."
"And consumers are quite confident about their future financial outlook. Still, we will be looking at other data (such as ANZ observed card spending) for any confirmation that household financial conditions are tightening."