January 24, 2023
Consumer confidence softens
- Consumer confidence decreased by 1.8pts last week to 85.9. Among the mainland states, confidence declined in NSW, Victoria, Queensland and WA and increased in SA.
- 'Weekly inflation expectations’ increased 0.3ppt to 5.7%. Its moving average for the last four releases fell 0.1ppt to 5.5%.
- Four of the five confidence subindices registered losses. ‘Current financial conditions’ fell 2.5pts its first loss since early December. ‘Future financial conditions’ dropped 2.3pts but remains above the neutral level of 100.
- ‘Current economic conditions’ bucked the trend and rose 1.8pts, while ‘future economic conditions’ was down 1.9pts.
- ‘Time to buy a major household item’ decreased by 4.1pts.
"Consumer confidence softened by 1.8pts to 85.9 last week, representing the first drop in confidence in 2023 so far," said ANZ Senior Economist Adelaide Timbrell.
"Consumer confidence regarding current and future finances fell a little, though future financial conditions are still in positive territory.
"Sentiment about current economic conditions improved but consumers’ five-year view outlook on the economy softened. Household inflation expectations rose 0.3ppt to 5.7% but remained below the inflation expectations of late 2022.
"Media coverage of the inflation data and the first RBA meeting of 2023, which we expect to result in a cash rate hike, could both be headwinds for confidence in coming weeks."