Consumer confidence increased by 2.1 per cent last week, reaching its highest level since late May. Confidence rose for a second straight week in NSW, Queensland, and WA, while it dropped in Victoria and SA.
• ‘Weekly inflation expectations’ fell sharply by 0.6ppt to 5.0%, the lowest since mid-February. Its four-week moving average fell 0.1ppt to 5.3 per cent.
• Four of the five confidence subindices registered gains. ‘Current economic conditions’ was up 4.8 per cent after a 5.2 per cent fall over the previous two weeks. ‘Future economic conditions’ jumped 6.0 per cent, exceeding the neutral level of 100 for the first time since late February.
• ‘Current financial conditions’ rose 2.4 per cent after a 4.8 per cent decline the week before. ‘Future financial conditions’ bucked the trend with a 3.2 per cent decrease but remains above the neutral level of 100.
• ‘Time to buy a major household item’ rose 2.5 per cent, its fourth weekly gain.
“Consumer confidence rose 2.1 per cent last week, hitting a four-month high of 87.8. While confidence was still well below the neutral level of 100, at least two of the five confidence subindices exceeded 100 for the first time since early March.” ANZ Senior Economist, Catherine Birch said.
“The increase in headline confidence was mainly driven by improved sentiment around Australia’s economic conditions. Continued strength despite 225bp of rate hikes over the past five months may be quelling fears of a sharp downturn.
ANZ-observed spending data show household spending was solid in the first half of September, including on discretionary goods and services. The sharp drop in inflation expectations to a seven-month low of 5.0 per cent, despite higher petrol prices, also likely supported confidence.”
