Australian consumer confidence has taken a hit, according to the latest ANZ-Roy Morgan data. Last week, overall confidence fell by 2 percentage points to 83.5, with declines observed across all subindices. This indicates a broad weakening in consumer sentiment nationwide. ANZ is one of Australia’s largest banks, providing a range of financial services. Roy Morgan is a well-known market research company providing insights into consumer behaviour.
A significant driver of the decline was a 5.6 percentage point drop in the “time to buy a major household item” index. Economists suggest this is likely due to the conclusion of Black Friday sales, which typically spur increased spending. Adding to the concern, confidence in future household finances has sunk to its lowest level since November 2023, reflecting worries about financial stability among Australian households.
Inflation expectations continue to be a key factor influencing consumer sentiment. The four-week moving average for inflation expectations rose by 0.1 percentage points to 5.5 per cent. This is the highest level recorded since late 2023, signalling persistent inflationary pressures within the Australian economy.
ANZ economist Sophia Angala noted that the data reinforces expectations that the Reserve Bank of Australia (RBA) will likely maintain the current cash rate of 4.35 per cent for an extended period. The sustained inflationary pressures, as reflected in the survey, provide little incentive for the RBA to consider easing monetary policy in the near term.
