Confidence fell by more than two per cent last week, but still remains “well above its long run average”, a new report has revealed.
The weekly ANZ-Roy Morgan Australian Consumer Confidence report found that consumer confidence fell by 2.2 per cent in the week ending 2 October, and that the fall was “broad based”.
According to ANZ Research, while consumer confidence remained “volatile”, the four-week report average had been on the rise as consumers “remain particularly optimistic about their own finances”.
“A strong housing market and ongoing improvement in the labour market are key factors here,” said ANZ head of Australian economics Felicity Emmett.
Ms Emmett noted, however, that this optimism had not been reflected in consumer spending of late.
Consumers’ views toward their current finances fell 2.7 per cent, while their views toward future finances declined by 1.4 per cent.
Similarly, the report found that householders’ views on whether ‘now is a good time to buy a household item’ dropped by a solid 3.8 per cent.
“Retail sales have been soft, and overall consumer spending growth stepped down in Q2,” said Ms Emmett.
“On this front, we’ll be watching this week’s read on August retail sales to give us an idea as to whether the recent strength in confidence has translated into stronger spending.”
The report also found households were less optimistic about the economic outlook, as views toward the 12-month and five-year economic outlook slipped by 2.1 per cent and 1.4 per cent respectively.