"Consumer confidence declined 4.5 per cent last week, to its lowest levels since April 2020, as the Reserve Bank of Australia, increased interest rates by 50 basis points for the third month in a row to 1.85 per cent," ANZ Head of Australian Economics, David Plank said.
"Household inflation expectations increased 0.1 percentage to 5.6 per cent despite petrol prices falling for a fourth consecutive week. Demand for housing has been dropping, along with house prices."
"That and rising interest rates caused confidence among homeowners to drop 7 per cent last week. So far in 2022, household spending has been robust despite very weak consumer sentiment, with strong employment gains, high levels of household saving and a desire to travel more than offsetting concerns about the rising cost of living."
"It remains to be seen whether this divergence between confidence and spending can continue. Certainly, we expect employment to remain robust through 2022 and wages growth to pick up. This may be enough to keep households spending, even if they feel wary about the outlook."