Overall, the sustained slump in Australian consumer confidence poses significant challenges for policymakers and further highlights the impact of rising mortgage interest rates on household sentiment.
Inflation Retreat and Possibility of Interest Rate Cuts
Inflation is showing signs of a sharp retreat, causing the public conversation to shift towards the potential for interest rate cuts by mid-2024.
Renters Experience a Significant Drop in Confidence
According to the data, there has been a notable decrease in confidence among renters over the course of the week. Consumer confidence remains at its lowest for households with a mortgage; however, there has been a recent uptick in confidence among this group, reaching its highest level in five months.
Weekly Inflation Expectations and Financial Conditions
The survey indicates that weekly inflation expectations have fallen by 0.1 percentage points, now standing at 5.2%. The four-week moving average remains unchanged at 5.3%.
Sentiment surrounding current financial conditions saw a decline of 0.8 points, whereas future financial conditions experienced a gain of 2.2 points, partially offsetting a previous decline of 3.0 points. Moreover, current economic conditions improved by 1.2 points during the week, while future economic conditions faced a drop of 4.7 points.
Consumer Willingness to Purchase Major Household Items
When asked about their willingness to buy a major household item, consumers displayed a 3.3-point decrease in the index over the week.
ANZ-Roy Morgan Australian Consumer Confidence Rating
The weekly ANZ-Roy Morgan Australian consumer confidence rating is based on a total of 1,505 interviews conducted both online and over the telephone throughout the week, up until Sunday.