In research conducted by ANZ and Roy Morgan, consumer confidence fell 1.1 per cent in the last week, despite a cash rate cut and the passage of income tax offsets for middle income earners.
“Confidence fell 1.1 per cent, despite the RBA’s second rate cut. The passage of the tax cuts has also not been an immediate boost to sentiment. We need to put this in context, however. Consumer confidence rose sharply in the prior week and is above average, so some consolidation is not completely unexpected,” David Plank, ANZ head of Australian economics, said.
“Interestingly, confidence also fell immediately following the June RBA rate cut, suggesting the immediate takeaway from monetary easing is not necessarily positive. The mixed nature of last week’s data, with another trade surplus but soft retail sales, may also have contributed,” he added.
According to ANZ and Roy Morgan, confidence in current finances have increased by 3.7 per cent for the week, while confidence in future finances have also risen by 1.3 percent.
In contrast, metrics were down across other key economic indicators, including confidence about future economic conditions. However, these indices declines were not disappointing when compared to the gains of 13.3 per cent and 7 per cent, respectively, in the previous report.