In mid-January, the ANZ-Roy Morgan Consumer Confidence Index experienced a minor setback, falling 1.3 points to 85.8.
This marks a downward trend in buying intentions, highlighting consecutive weeks of decreased consumer enthusiasm for significant purchases.
Despite the recent decline, consumer confidence remains 1.4 points higher than the same period last year (January 15-21) when it stood at 84.4. It is also 2.9 points above the average for 2024, indicating a relatively stable outlook compared to last year’s figures.
The latest figures show a decrease in consumer confidence across New South Wales, Victoria, and Queensland. In contrast, sentiment remained steady in Western Australia and South Australia, showing a mixed regional response to current economic conditions.
The proportion of Australians who feel financially better off than last year has slightly decreased to 21%, while those feeling worse off has also edged down to 48%.
Expectations for personal finances over the next year have dipped, influenced by increased pessimism, with 31% of respondents expecting to be worse off, a rise from previous figures, ANZ-Roy Morgan reported.
Short-term economic outlook remains largely unchanged, with a slight decrease in optimism about the coming year.
Conversely, medium-term economic sentiment has slightly worsened, with more Australians bracing for tougher economic conditions over the next five years.
The ANZ-Roy Morgan index measuring the sentiment on purchasing major household items also fell, with only 25% of respondents considering it a good time to buy, down from previous weeks.
This decline aligns with rising household inflation expectations, despite a recent drop in official inflation figures.
“The positive impact of the New Year appears to be waning, as ANZ-Roy Morgan Australian Consumer Confidence fell last week,” said Sophia Angala (pictured above), ANZ economist.
Angala pointed to several factors influencing this trend, including the highest household inflation expectations since June 2024 and the recent depreciation of the AUD/USD exchange rate.
While consumer confidence has slightly decreased, it remains above the lows experienced in the previous year. Continued monitoring of buying intentions and economic optimism will be essential to gauge the potential for recovery or further declines in consumer sentiment.
Read the complete Roy Morgan Consumer Confidence report here.
