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Consumer Confidence declines

Consumer confidence declined by 2.8 per cent last week, dropping to its lowest value since early October. Among the major states, confidence was down in NSW, Victoria, South Australia and Western Australia, while it rose only slightly in Queensland.


‘Weekly inflation expectations’ increased 0.1ppt to 5.0 per cent and the four-week moving average also rose 0.1ppt to 5.0 per cent.


Four out of the five confidence subindices declined. ‘Current financial conditions’ dropped 4.7 per cent and ‘future financial conditions’ fell 3.0 per cent.


‘Current economic conditions’ rose 0.4 per cent, its third consecutive small gain. ‘Future economic conditions’ declined 3.2 per cent.


‘Time to buy a major household item’ dropped 3.4 per cent, after rising 8.3 per cent over the past five weeks.


"Consumer confidence dropped 2.8 per cent last week, possibly influenced by the weaker-than-expected employment data for October." ANZ Head of Australian Economics, David Plank said.


"Elevated inflation expectations may also be dragging sentiment down, particularly given the headlines about global inflation pressures following the rise in the US CPI. Both weekly inflation expectations and its four-week moving average rose 0.1ppt to 5.0 per cent."


"The drop in confidence about ‘current financial conditions’ may reflect concerns about rising prices, though this subindex is higher than it was this time last year despite the sharp rise in inflation expectations since then."


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