Invest
Consumer confidence plunges on prolonged lockdowns
Prolonged lockdowns in Sydney and Melbourne have seen consumer confidence plummet to November 2020 lows, putting more pressure on the economic recovery, a new survey has revealed.
Consumer confidence plunges on prolonged lockdowns
Prolonged lockdowns in Sydney and Melbourne have seen consumer confidence plummet to November 2020 lows, putting more pressure on the economic recovery, a new survey has revealed.
The latest ANZ-Roy Morgan consumer confidence survey shows Greater Sydney and Melbourne lockdowns have seen consumer confidence fall to 104.3 points, with a score above 100 showing optimism in the future.
The 5.7-point fall over the last week means consumer confidence is now at its lowest point since November 2020.
In a concerning development, the consumer survey revealed that less than one in six Aussies now expects ‘good times’ for the economy over the next 12 months, while nearly a quarter expect ‘bad times’ ahead.
Extended out to over the next five years, less than one in five is predicting a strong economy, while 17 per cent are predicting bad economic times to come.
ANZ’s head of Australian economics, David Plank, said a lack of consumer confidence will have an impact on spending and the economy at large.
“The subindices that capture economic conditions and ‘time to buy a major household item’ are at their worst levels since early November 2020, highlighting some renewed caution of households – albeit nowhere near the lows seen in the early stage of the pandemic,” the economist said.
However, in positive news for the economy, the number of Australian families conceding they are ‘better off’ financially has now increased to 29 per cent, albeit 28 per cent say they are ‘worse off’.
The research also revealed that 38 per cent of Australians expect their family to be better off financially this time next year, compared with just 17 per cent of Aussies who are expecting to be ‘worse off’ financially.
Australian economy set to take a hit
A lack of consumer spending is not the only headwind the economy faces, with the current lockdown restrictions forcing businesses to close.
Commonwealth Bank’s head of economics Australia, Gareth Aird, told nestegg that current lockdowns are set to cost billions.
“With new restrictions on retail and construction, the cost of Greater Sydney lockdown has increased to around $2 billion a week. Cost of the Victoria lockdown is around $1 billion a week,” Mr Aird said.
He explained the combined cost per week in current form is $3 billion, which is worth 0.15 per cent of annual GDP or 0.6 per cent of quarterly GDP.
While the government’s latest government data has revealed that as many as 331,000 disaster payment claims worth $155 million have already been granted across locked-down Sydney and surrounds, this is unlikely to help the broader economy.
When asked if the government’s package will offset the losses, Mr Aird said, “Yes, not in terms of GDP lost during the lockdown, but income payments will support a swift bounce in activity once restrictions are eased.”
RELATED ARTICLES
-
Australia’s spending surprise raises the odds of a February rate move — here’s how to protect margin and momentum
-
Australia’s inflation cools to 3.4% — why the RBA’s next move still isn’t a lay‑up for business
-
Inflation cools to 3.4% — but the RBA’s reaction function keeps businesses on a knife-edge
About the author
About the author
Economy
Australia’s spending surprise raises the odds of a February rate move — here’s how to protect margin and momentum
Household outlays are running hotter than economists expected, with the latest ABS readings showing broad-based gains across services and goods. That resilience is exactly the kind of demand impulse ...Read more
Economy
Australia’s inflation cools to 3.4% — why the RBA’s next move still isn’t a lay‑up for business
Headline inflation easing is good optics; balance sheets feel something different. With year‑on‑year CPI down to 3.4% in November from 3.8%, hopes for rate relief are rising — but policymakers remain ...Read more
Economy
Inflation cools to 3.4% — but the RBA’s reaction function keeps businesses on a knife-edge
Australia’s headline CPI edged down to 3.4% year-on-year in November, from 3.8%, easing immediate pressure but not eliminating the risk of further tightening. With services inflation sticky and ...Read more
Economy
Higher-for-longer, not higher forever: How Australia’s inflation ‘surprise’ is rewriting CFO playbooks for 2026
Australia’s latest inflation pulse eased but didn’t budge bank outlooks: near‑term rate cuts are still a long shot, with some houses flagging upside risk. That steadier‑for‑longer cash rate is pushing ...Read more
Economy
Australia's inflation illusion: the real challenge lies in pricing power and productivity
Headline inflation has cooled to 3.4% year-on-year, but the Reserve Bank’s caution—and a still‑hot housing backdrop—mean the rate threat hasn’t left the room. For boards, the next few quarters are ...Read more
Economy
When house prices lift, tills ring: A case study in turning Australia’s wealth effect into growth
Australia’s latest upswing in household wealth, anchored by higher dwelling values, is more than a feel‑good statistic—it is a profit and planning signal. The ABS notes property’s centrality to ...Read more
Economy
RBA's hawkish stance reflects inflation concerns, State Street economist comments
In a recent statement, the Reserve Bank of Australia (RBA) has signaled a hawkish stance on interest rates, drawing insights from financial experts about the implications for Australia's economic ...Read more
Economy
Navigating the inflation maze: How CFOs can outsmart economic hurdles in Australia
Fresh inflation data have cooled expectations of near-term rate cuts in Australia, intensifying pressure on margins, capital allocation and demand. Rather than wait for monetary relief that may not ...Read more
Economy
Australia’s spending surprise raises the odds of a February rate move — here’s how to protect margin and momentum
Household outlays are running hotter than economists expected, with the latest ABS readings showing broad-based gains across services and goods. That resilience is exactly the kind of demand impulse ...Read more
Economy
Australia’s inflation cools to 3.4% — why the RBA’s next move still isn’t a lay‑up for business
Headline inflation easing is good optics; balance sheets feel something different. With year‑on‑year CPI down to 3.4% in November from 3.8%, hopes for rate relief are rising — but policymakers remain ...Read more
Economy
Inflation cools to 3.4% — but the RBA’s reaction function keeps businesses on a knife-edge
Australia’s headline CPI edged down to 3.4% year-on-year in November, from 3.8%, easing immediate pressure but not eliminating the risk of further tightening. With services inflation sticky and ...Read more
Economy
Higher-for-longer, not higher forever: How Australia’s inflation ‘surprise’ is rewriting CFO playbooks for 2026
Australia’s latest inflation pulse eased but didn’t budge bank outlooks: near‑term rate cuts are still a long shot, with some houses flagging upside risk. That steadier‑for‑longer cash rate is pushing ...Read more
Economy
Australia's inflation illusion: the real challenge lies in pricing power and productivity
Headline inflation has cooled to 3.4% year-on-year, but the Reserve Bank’s caution—and a still‑hot housing backdrop—mean the rate threat hasn’t left the room. For boards, the next few quarters are ...Read more
Economy
When house prices lift, tills ring: A case study in turning Australia’s wealth effect into growth
Australia’s latest upswing in household wealth, anchored by higher dwelling values, is more than a feel‑good statistic—it is a profit and planning signal. The ABS notes property’s centrality to ...Read more
Economy
RBA's hawkish stance reflects inflation concerns, State Street economist comments
In a recent statement, the Reserve Bank of Australia (RBA) has signaled a hawkish stance on interest rates, drawing insights from financial experts about the implications for Australia's economic ...Read more
Economy
Navigating the inflation maze: How CFOs can outsmart economic hurdles in Australia
Fresh inflation data have cooled expectations of near-term rate cuts in Australia, intensifying pressure on margins, capital allocation and demand. Rather than wait for monetary relief that may not ...Read more
