Consumer confidence softens

Consumer confidence fell 1.4 per cent amidst fears of another COVID outbreak. Despite the fall, confidence remained above the 2021 weekly average and close to the long-run average.

Three out of the five subindices registered a loss. Against the overall trend, ‘current financial conditions’ gained 0.5 per cent, while ‘future financial conditions’ fell 2 per cent.

‘Current economic conditions’ weakened 2.1 per cent and ‘future economic conditions’ declined 4.1 per cent.

‘Time to buy a major household item’ rose 0.9 per cent. ‘Weekly inflation expectations’ remained steady at 3.7 per cent, keeping the four-week moving average unchanged at 3.8 per cent.

“The three-day lockdown of the Perth and Peel region following the emergence of new COVID-19 infections led to a fall of 1.4 per cent in consumer confidence,” ANZ Head of Australian Economics, David Plank, said.

“Not surprisingly, sentiment in Perth fell the most (-8.2 per cent), but Brisbane (-4.9 per cent), Sydney (-3.6 per cent) and Melbourne (-4.4 per cent) were also impacted. Both the ‘current’ and ‘future economic conditions’ took a hit following a rise in the past two weeks.”

“This fall is possibly due to the uncertainty surrounding the new strains of the virus. We know, however, from previous experience that a quick resolution of the lockdown will see sentiment (and spending) rebound very quickly.”

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