Household item sub-index bounces back.
The latest ANZ-Roy Morgan Australian Consumer Confidence index rose 2.1% last week, its highest value in five weeks. And, as an indication of how fickle the consumer can be, the ‘time to buy a household item’ sub-index bounced 4.1%, almost entirely reversing the previous week’s 4.3% decline.
Views on financial conditions improved further, rising 1.6% on the back of a 3.5% bounce previously while sentiment toward both current and future economic conditions continued to recover, rising a solid 3.4% and 3.2% respectively. Both sub-indices currently sit at their highest value in five weeks, due to successive weekly gains. Inflation expectations remained steady at 4.5% on a four week moving average basis.
Source: Roy Morgan
ANZ’s head of Australian economics, David Plank attributed the rise in confidence to the improvement in households’ views towards economic conditions, along with a greater willingness to buy a major household item. “This likely reflects some recovery in domestic equity markets in recent weeks as well as a slight reprieve from trade related headlines, at least for the moment,” he said.
“Interestingly, the gain came despite the fact that last week’s employment report brought an end to a record run in jobs growth. Forward indicators of employment remain quite positive, suggesting that the underlying strength of the labour market is more robust than the February/March data implies.”
Increasing talk about personal income tax cuts as the Commonwealth Budget approaches is also boosting sentiment, Plank said.