Consumer confidence falls further

Consumer confidence fell 0.5 per cent last week, its third-straight weekly decline.

Financial conditions were mixed, with ‘current finances’ gaining 1.2 per cent while ‘future finances’ declined by 1.4 per cent.

‘Current economic conditions’ declined for the fourth straight week, falling 3.4 per cent, while ‘future economic conditions’ gained 1.8 per cent.

‘Time to buy a household item’ continued to deteriorate, falling 1.9 per cent last week. ‘Inflation expectations’ was stable at 3.2 per cent (four-week moving average).

“Confidence declined further last week, building on the falls seen over the previous two weeks,” ANZ Head of Australian Economics, David Plank said. “Consumer confidence is now down some 6 per cent from its level in mid-June as it recovered from the historic low seen at the end of March.”

“The deteriorating conditions in Melbourne and the renewed lockdown are most likely the primary contributor to the turn in sentiment. The biggest fall has been in ‘current economic’ conditions, which are down around 15 per cent over this period.”

“In contrast, sentiment toward personal finances is close to unchanged, highlighting the role that the massive fiscal stimulus has played in shielding people from the direct fall-out of the economic slump triggered by the health response to the pandemic.”

“How this fiscal support will evolve over the months ahead is the most critical decision facing the Government and the economy.”

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