ANZ-Roy Morgan Consumer Confidence increased 2.6 points to 83.9 this week after the Reserve Bank of Australia left interest rates unchanged for a sixth straight meeting last Tuesday.
Despite the improvement, the index has now spent a record 80 straight weeks below the mark of 85.
Consumer confidence is now 5.7 points above the same week a year ago and 3.1 points above the 2024 weekly average of 81.8.
The driver of this week’s increase was increasing confidence about personal finances, with ANZ and Roy Morgan noting that this is especially as it relates to comparisons to a year ago which recorded its best net result for over 18 months since January 2023 - including the highest proportion of Australians saying they are ‘better off’ financially than a year ago since November 2022.
Now nearly a quarter of Australians (24 per cent - up 3ppts), say their families are ‘better off’ financially than this time last year - the highest figure for this indicator for nearly two years since November 2022.This is compared to 47 per cent (down 4ppts) that say their families are ‘worse off’, the lowest figure for this indicator for 18 months since February 2023.
Views on personal finances over the next year have improved this week with 32 per cent (up 2ppts) of Australians expecting their family to be ‘better off’ financially this time next year while a third (33 per cent - down 1ppt) are expecting to be ‘worse off’.
Over the next twelve months, 9 per cent (up 1ppt) of Australians expect ‘good times’ for the Australian economy compared to 34 per cent (unchanged) that expect ‘bad times’.
Net sentiment regarding the Australian economy in the longer term was virtually unchanged this week with only 10 per cent (unchanged) of Australians expecting ‘good times’ for the economy over the next five years compared to 19 per cent (down 1ppt) expecting ‘bad times’.
Buying intentions were also virtually unchanged this week with 24 per cent (up 2ppts) saying now is a ‘good time to buy’ major household items compared to 47 per cent (up 1ppt) that say now is a ‘bad time to buy’ major household items.
ANZ economist Madeline Dunk said the latest lift in consumer confidence pushes the four-week moving average to a six-month high of 83.2 points.
“All of the subindices improved, but there was a particularly big jump in household’s confidence in their current financial conditions,” Dunk said. “The subindex lifted 7.1pts, recording its largest weekly rise since late last year. This takes the four-week moving average to its highest level since March 2023.
“The rise may be linked to the RBA’s decision to keep rates on hold last week. It is also possible that households are starting to feel the positive impact of the Stage 3 tax cuts on their finances.
“Notably, the four-week moving average for the ‘time to buy a major household item’ subindex recorded its second highest reading since February 2023.”