The latest weekly ANZ – Roy Morgan weekly consumer sentiment survey for the week ending Sunday is out. This is the first opportunity to gauge the impact of the counterterrorism raids in NSW and Queensland last week on the consumer mood and it looks like good news.
The ANZ reported confidence rose 1.4% and that the move higher was broad-based. Importantly the key longer term drivers of consumer expectations were higher with “expectations of ‘economic conditions over the next five years’ (+3.7%) and ‘financial situation next year’ (+3.4%). ‘Time to buy a major household item’ (-1.5%) was the only sub-index to fall last week and is now at the lowest level since mid-June.”
So on balance confidence has stabilised around the long run average which suggests a certain resilience of consumers to all the uncertainty around them at the moment. But equally it suggests some caution in the months ahead as the situation with ISIS and the Australian economy evolves.
ANZ Chief Economist Warren Hogan said, “After improving strongly through June and July, consumer confidence appears to have stabilised around its long-run average level. While we expect soft income growth to weigh on consumer confidence and spending going into 2015, this should be offset to some extent by wealth effects from rising house prices.”
Indeed, maybe house prices rises is the rising tide that covers all sins and concerns.