Down 3.2%.

The ANZ-Roy Morgan Australian Consumer Confidence index dropped 3.2% in the week ending May 28, unwinding over half of the cumulative gains over the past six weeks. Confidence fell across all sub-indices, led by a sharp fall in views towards future financial conditions.

The ‘time to buy a household item’ sub-index dropped 3.9%, reversing the previous week’s rise of 2.6%.

Households’ views towards current financial conditions fell 2.7% reversing gains over the previous two weeks with views towards future financial conditions falling 4.1%, its lowest level since last November.

Sentiment around current economic conditions eased 2.4% following no change previously while the outlook towards future economic conditions fell 2.5% this week, adding to the 1.9% loss in the previous week. Inflation expectations also climbed sharply to 4.7%.

ANZ’S head of Australian Economics, David Plank said some payback, particularly in views towards economic conditions, is unsurprising given their sharp improvement since early April. “Importantly, confidence is still well above its long-run average,” he said.

“The fall in views towards financial conditions is a little worrying, however. This could reflect homeowners’ concerns about falling house prices, particularly in Sydney and Melbourne. Moreover, these concerns are likely exacerbated by the high existing household debt level and expectations of lackluster wage growth in the near future. That said, despite the recent decline, views towards both current and future financial conditions remain above their long-term averages,” Plank said.