ANZ-Roy Morgan Consumer Confidence dropped 5.5 points to 78.1 this week after the RBA increased interest rates to 3.35% – the highest rate since October 2012. This was the largest weekly drop in consumer confidence following an RBA meeting since interest rates rose 0.5% in June 2022.
Consumer confidence is now 25.1 points below the same week a year ago and 6.8 points below the 2023 weekly average of 84.9 with increasing concern about the economy over the next year.
Only one in five (19%) Australians say their families are ‘better off’ financially than this time last year – the lowest figure for this indicator since April 2020, compared to almost half (49%) that say their families are ‘worse off’ financially.
When it comes to buying intentions, only 17% of Australians say it is a ‘good time to buy’ major household items – also the lowest figure for this indicator since April 2020, while more than half (54%) say it is a ‘bad time to buy’.
“Consumer confidence fell after the RBA raised interest rates by 25 basis points. This was the sharpest weekly drop in confidence since the June 2022 RBA meeting, which delivered the first 50 basis points cash rate hike of the current interest rate cycle,” ANZ senior economist, Adelaide Timbrell said.
“The average confidence among people paying off their mortgages fell sharper than other housing cohorts last week, by 10 points to its lowest since early April 2020. Confidence among homeowners and renters also fell, by 5.2 points and 2.9 points respectively. The subindex for whether ‘it is a good time’ to buy a major household item dropped to its lowest since April 2020.”