Consumer confidence declines again

Consumer confidence declined almost 2 per cent last week, with weakness in all the subindices. This was the fifth decline in a row and the largest weekly decline in a month.

‘Current finances’ declined by 0.1 per cent after three-straight weeks of gains. ‘Future finances’ fell 1.6 per cent, its third-straight weekly decline.

‘Current economic conditions’ declined for the sixth straight week, falling 2.4 per cent, while ‘future economic conditions’ fell 0.8 per cent.

‘Time to buy a household item’ also deteriorated, falling 4.2 per cent. ‘Inflation expectations’ gained 0.1 percentage point to 3.4 per cent (four-week moving average).

“Confidence continues to deteriorate, with a fifth-straight decline.” ANZ Head of Australian Economics David Plank said. “Sentiment has dropped almost 10 per cent from its high at the end of May.”

“The rise in pandemic related deaths in Victoria and new case numbers rising in Sydney seem to be sapping confidence.”

“The reductions in the Jobkeeper and Jobseeker payments from the end of September may have also weighed, with ‘current economic conditions’ falling sharply and the improvement in ‘current finances’ stalling at a low level.”

“Inflation expectations rose again, with the four week moving average at its highest level since mid-May. This lift comes just ahead of the second-quarter inflation data, which is likely to show the biggest ever fall in headline inflation.”

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