However, it is still significantly below the same point it was at this time last year.
The survey showed that consumer confidence has increased by 2.3pts to 93.4 this week after average petrol prices in Australia dropped by around 30¢ per litre over the last two weeks. Consumer confidence had fallen for three straight weeks before this week’s increase.
And despite confidence turning around, people are still not feeling their future is looking any brighter. Now just 26 per cent (up 2ppts) of Australians said their families are “better off” financially than this time last year compared to 38 per cent (down 2ppts), who said their families are “worse off” financially.
Looking forward, 33 per cent (down 2ppts) of Australians expect their family to be “better off” financially this time next year compared to just 25 per cent (down 1 ppt) who expect to be “worse off” financially.
Only 12 per cent (up 2ppts), of Australians expect “good times” for the Australian economy over the next 12 months compared to 28 per cent (down 2ppts), who expect “bad times”.
In the longer term, just 15 per cent (up 1ppt), of Australians are expecting “good times” for the economy over the next five years compared to 20 per cent (unchanged) expecting “bad times”.
Buying intentions have slightly improved, with 32 per cent (up 2ppts) of Australians, saying now is a “good time to buy” major household items while 40 per cent (down 2ppts) said now is a “bad time to buy”.
ANZ head of Australian economics, David Plank, said the drop in petrol prices is most probably the reason for the lift in sentiment.
“Inflation expectations (IE) dropped 0.6ppt last week to 5.8 per cent, as petrol prices dropped sharply. We think this explains much of the lift in sentiment, though the focus [on] relieving cost of living pressures in the Federal Budget may also have played a part,” he said.
“The fall in petrol prices is likely due to lagged effects of the drop in crude prices since 8 March which have declined by nearly 20 per cent since then. The cut to petrol excise announced in the Budget may, depending on volatile oil prices, see petrol prices drop further in the coming weeks. This could potentially lower IE and lift consumer sentiment further.”
