Consumer confidence: second straight rise

• ANZ-Roy Morgan Australian Consumer Confidence rose 2.1% last week to 118.4 – its highest value in five weeks. The details were also positive, with all but one subindex posting gains.
• Households’ views toward current financial conditions dipped 2.4% last week, partially reversing the 4.6% bounce previously. Meanwhile sentiment around future financial conditions improved further, rising 1.6% on the back of a 3.5% bounce previously.
• Sentiment toward both current and future economic conditions continued to recover, rising a solid 3.4% and 3.2% respectively last week. Both subindices currently sit at their highest value in five weeks, due to successive weekly gains.
• The ‘time to buy a household item’ subindex bounced 4.1%, almost entirely reversing the previous week’s 4.3% decline. Inflation expectations remained steady at 4.5% on a fourweek moving average basis.

ANZ’S HEAD OF AUSTRALIAN ECONOMICS, DAVID PLANK, COMMENTED:

“Confidence rose materially this week, driven by an 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.

Interestingly, the gain came despite the fact that last week’s employment report brought an end to record run in jobs growth. Forward indicators of employment remain quite positive, however, suggesting that the underlying strength of the labour market is more robust than the February/March data implies. It is possible that increasing talk about personal income tax cuts as

the Commonwealth Budget approaches is boosting sentiment.”

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