Western Australia is the only state or territory to record an increase in consumer confidence.
“Weekly inflation expectations” surged 0.5ppt to 6 per cent, while its four-week moving average rose 0.1ppt to 5.5 per cent.
Four of the five confidence subindices declined — “Current financial conditions” dropped 1 per cent, for the third consecutive week while “Future financial conditions” decreased 3.6 per cent, falling below the neutral level of 100 for the first time since early August.
“Current economic conditions” rose slightly by 0.6 per cent after dropping 10.4 per cent over the previous two weeks and “Future economic conditions” fell 2.6 per cent.
And it seems consumers are finally holding back on buying large-ticket items with the “Time to buy a major household item” losing 6.2 per cent after a 4.4 per cent decline the week before.
ANZ head of Australian Economics, David Plank, said the weaker Australian dollar, along with an uptick in petrol prices over the past couple of weeks likely led to the surge in household inflation expectations to 6 per cent.
“This weighed heavily on consumer sentiment, with the subindex that captures whether ‘it is a good time to buy a major household item’ dropping 6.2 per cent,” he said.
“Very weak consumer confidence has not, so far, translated into lower household spending. But the longer confidence remains so low the greater the prospect that consumers become more cautious, especially with household wealth going backwards due to lower house and equity prices.”
