Sep 27, 2022
October 4, 2022
Consumer confidence hit by global turbulence
Consumer confidence retreated 2.6 per cent last week, offsetting the gains over September. Confidence fell in all mainland states – its first synchronous drop since early August.
• ‘Weekly inflation expectations’ spiked by 0.6ppt to 5.6 per cent, its highest level since mid-August. The four-week moving average rose 0.1ppt to 5.4 per cent.
• Four of the five confidence subindices declined. The economic subindices plunged, with ‘current economic conditions’ down by 7.6 per cent and ‘future economic conditions’ declining 7.5 per cent.
• ‘Current financial conditions’ fell by 1.5 per cent, while ‘future financial conditions’ weakened by 1 per cent.
• ‘Time to buy a major household item’ was the only subindex to improve, rising 4.8%, its fifth consecutive weekly gain.
"The weakness in global financial markets through last week weighed on Australian consumers. A plethora of negative news last week ranging from the UK’s mini budget to hawkish Fed commentary impacted the AUD, which weakened to its two-year lows." ANZ Head of Australian Economics, David Plank said.
"We often see consumer sentiment soften in line with AUD weakness. The jump in inflation expectations, likely linked to the end of the temporary petrol excise cut and uptick in petrol prices, also weighed on sentiment. Consumer confidence will remain fragile as long as market volatility is the dominant theme globally. The RBA’s October rate decision will also impact in the near-term."
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