Australia’s Consumer Confidence Rebounds By 10.1%, The Most Significant Jump On Record
Last week the ANZ-Roy Morgan Consumer Confidence index jumped up by 10.1%, the biggest gain since the survey moved to a weekly format in 2008.
The ‘time to buy a major household item’ category rose by 17.5%, against a drop of 23.8% the week before. The ‘future financial conditions’ category was up 11.4% and ‘current financial conditions’ increased by 8.8%.
“We think it represents a strong endorsement of the government’s massive wage subsidy package, announced on 30th March. Better news about the flattening of the ‘pandemic curve’ may also have contributed,” ANZ Head of Australian Economics David Plank said.
However, these percentage increases need to be considered in the context of last week’s historic lows.
For example, although ‘current economic conditions’ rose by a substantial 24.6%, confidence for this category is still only 50% of what it was six weeks ago.
“The bounce needs to be kept in perspective – confidence is still around the lows seen in 1990 during the last recession, so consumers can hardly be said to be cheerful or ready to spend. But it is nice to be commenting on some better news,” Plank said.
Australia’s business sentiment is not as strong – the Business Confidence index declined by 9.1% in March. However, it is worth noting that Business Confidence is measured monthly, whilst Consumer Confidence is measured weekly.
In the Business Confidence index, Roy Morgan noted that there may will be an uptick in April as a result of the government’s stimulus packages.