Consumer confidence
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Consumer sentiment on the rise.
Consumer confidence rises: The weekly ANZ/Roy Morgan consumer confidence rating rose by 1.4 per cent in the week to January 18 to a 4-week high of 113.6, well above the 2014 average of 111.3 and above the long-term average of 112.8.
What does it all mean?
- Day-by-day, Aussie consumers are becoming more confident. While consumers don’t like the weaker Aussie dollar, as it pushes up the cost of imported goods and overseas holidays, they do like lower petrol prices. Add in the fact that employment is growing solidly and interest rates are set to remain low and what’s not to like? Confidence levels are now higher than ‘normal’ – that is, above long-term averages.
- Early indications are that the benefits of cheaper petrol prices are being spread between extra spending and extra saving/debt reduction.
- Consumer expectations about their financial position in a year’s time has lifted to an 8-week high, underpinned by lower petrol prices and expectations of stable interest rates.
What do the figures show?
Consumer sentiment:
- The ANZ/Roy Morgan consumer confidence rating rose by 1.4 per cent in the week to January 18 to a 5-week high of 113.6, well above the 2014 average of 111.3.
- Three of the five components of the index rose in the latest week:
- The estimate of family finances compared with a year ago was down from +5 to +3;
- The estimate of family finances over the next year was up from +20 to +26;
- Economic conditions over the next 12 months was up from -9 to -3;
- Economic conditions over the next 5 years was up from +5 to +8;
- The measure on whether it was a good time to buy a major household item was down from +39 to +34.
- The ANZ/Roy Morgan weekly survey of consumer confidence closely tracks the monthly Westpac/Melbourne Institute consumer sentiment index but the former measure is a timelier assessment of consumer attitudes, surveys more than 1,000 consumers each week and is now closely tracked by the Reserve Bank.
What is the importance of the economic data?
- The ANZ/Roy Morgan weekly survey of consumer confidence closely tracks the monthly Westpac/Melbourne Institute consumer sentiment index but the former measure is a timelier assessment of consumer attitudes, surveys more than 1,000 consumers each week and is now closely tracked by the Reserve Bank.
