The ANZ-Roy Morgan Consumer Confidence was virtually unchanged at 91.1 during the fourth week of March after dropping by 8.9pts over the previous two weeks and there were significant downgrades in various indices including now is a “good time to buy” major household items.
However, this was offset by more Australians becoming confident about their personal financial situation over the next year.
The news is not so positive about where Australians now see themselves financially with just 2 per cent saying their families are “better off” financially than this time last year compared to 40 per cent that said their families are “worse off” financially – the highest figure for this indicator for nearly two years since April 2020.
Looking forward, 35 per cent of Australians expect their family to be “better off” financially this time next year compared to just 26 per cent who expect to be “worse off” financially.
Only 10 per cent of Australians expect “good times” for the Australian economy over the next 12 months compared to 30 per cent who expect “bad times”.
In the longer term, just 14 per cent of Australians are expecting “good times” for the economy over the next five years – the lowest figure for this indicator for nearly two years since April 2020 – compared to 20 per cent expecting “bad times”.
Buying intentions have deteriorated further to their lowest since Victoria’s second wave with just 30 per cent of Australians, saying now is a “good time to buy” major household items while 42 per cent said now is a “bad time to buy” (the highest figure for this indicator for over 18 months since August 2020).
ANZ head of Australian economics, David Plank said inflation expectations surged 0.4ppt last week to a multi-year high of 6.4 per cent, even though petrol prices declined slightly.
“Consumer confidence was essentially unchanged despite this, with a slight decline of just 0.1 per cent,” he said.
“Within the detail, however, sentiment toward ‘current financial conditions’ dropped to its lowest since May 2020. Consumer confidence is very weak given the strength of employment, which we think is directly linked to concerns over cost-of-living pressures. It will be interesting to see whether the measures expected in the Federal Budget provide a boost to confidence.”
