Australia ANZ-Roy Morgan weekly consumer confidence reverses previous gains; financial outlook remains mixed

Australia’s ANZ-Roy Morgan weekly consumer confidence reversed previous week’s gains, with the latest reading down 0.8 percent and entirely reversing the prior week’s gain. The details were mixed, with gains in views towards current financial and future economic conditions partially offsetting falls in the remaining sub-indices, according to the latest report from ANZ Research.

Households’ optimism towards current financial conditions improved 0.5 percent last week, on the back of a 2.9 percent increase in the previous week. However, households were less optimistic about future financial conditions, which decreased 1.3 percent. Consumers’ assessment of current economic conditions declined 2.7 percent last week, partially unwinding the 4.1 percent gain in the previous week.

Meanwhile, views towards future economic conditions were up 1.4 percent last week following a 0.3 percent rise in the previous week. The ‘time to buy a household item’ sub-index fell 1.7 percent – its third consecutive weekly decline – to its lowest point in 16 weeks. Four week moving average inflation expectations edged back up to 4.3 percent.

"Given the fall in house prices, high levels of household debt and an already low savings rate future consumption growth is likely to depend heavily on wage growth. On this front, we look to the WPI print out on August 15, to provide some comfort that wages growth is past its bottom and will gradually move up," said David Plank, Head of Australian Economics, ANZ Research.