Record run ends for consumer confidence

The nine-week run of consecutive gains in the ANZ-Roy Morgan Australian Consumer Confidence Index has finally ended, with confidence falling 1.3 per cent.

The weakness was mainly due to the ‘time to buy a major household item’ component, which declined by 5.7 per cent.

Financial conditions were mixed. ‘Current finances’ gained 1.1 per cent, while ‘future finances’ declined by 0.7 per cent.

Economic conditions were also mixed with ‘current economic conditions’ gaining 1.6 per cent, while ‘future economic conditions’ weakened by 1.6 per cent.

The four-week moving average for ‘inflation expectations’ declined by 0.1 percentage points to 3.2 per cent. This is a historic low.

“Last week’s fall in confidence can be seen as more of a consolidating move than weakness, as it has come after the most extended stretch of gains in the history of the weekly survey,” ANZ Head of Australian Economics David Plank said.

“Economic conditions and financial conditions were essentially flat in aggregate; a pleasing result given the news (with the publication of first-quarter gross domestic product data) that Australia is almost certainly in a technical recession.”

“The overall weakness in confidence was due to the fall in ‘Time to buy a household item’. This sub-index has gained nearly 50 per cent since the low achieved during the height of the pandemic.”

“Weekly ‘inflation expectations’ remained at the low of 3.1 per cent, taking the four-week average down to a historic low of 3.2 per cent.”

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