Australian consumer confidence held steady last week with the latest ANZ-Roy Morgan consumer confidence index remaining at 113.5.
The index now sits 11% higher than the levels of a year ago and above its long-run average — an impressive performance in light of weak economic data released last week — with improved readings towards the economic outlook offsetting weakness in family finances.
Commenting on the result ANZ chief economist Warren Hogan believes a positive perception towards the federal budget, along with continued gains in house prices, are offsetting concerns surrounding weakness in the labour market and high levels of household debt.
“While it is a positive sign that consumer confidence has largely maintained the post budget bounce, the question is whether further momentum can build in coming weeks or whether the bounce will be retraced. Solid growth in house prices continues to be supportive for confidence but household fundamentals outside of housing remain weak amid low wages growth, a soft labour market, and high household debt.
How consumers reconcile the conflicting forces of strong house price gains and weak income growth will likely be a key determinant of confidence going forward.
Here are the weekly movements in the survey subindices:
- Financial situation compared to a year ago 106.0 (-3.1%)
- Financial situation next year 122.0 (-3.6%)
- Economic conditions next year 96.0 (+1.2%)
- Economic conditions next five years 112.0 (+4%)
- Time to buy a major household item 132.0 (+2.3%)