Australian consumer confidence has taken a significant hit, according to the latest ANZ-Roy Morgan survey. The index fell 3.1 points last week to 77.1, pushing sentiment to its lowest ebb since December 2023. The four-week moving average also declined, easing 0.9 points to 77.8, reinforcing the downward trend in overall consumer sentiment.
The downturn was broad-based, with all major sub-indexes registering declines. “Future financial conditions” experienced a notable drop of 4 points, hitting a multi-decade low. “Short-term economic confidence” also weakened considerably, falling by 5 points. The “current financial conditions” measure slipped 1.9 points, while the “time to buy a major household item” index edged down 2.9 points.
Inflation expectations remain elevated, with “weekly inflation expectations” edging up 0.1 percentage points to 5.3 per cent. The four-week average remained steady at 5.3 per cent, suggesting persistent concerns about the cost of living.
ANZ economist Sophia Angala noted that households are increasingly pessimistic about their financial situations and the economic outlook for the coming year. Angala suggested that persistent underlying inflation may prompt the Reserve Bank to consider a 25-basis-point increase in the cash rate at its May meeting.
