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(Australian Associated Press)
Consumer confidence rose last week, ending a run of three straight weekly declines, despite weakness in wage growth and a rise in unemployment.
The ANZ-Roy Morgan Australian Consumer Confidence Survey shows that consumer confidence was up 1.6 per cent at 113.8 points for the week ending March 26, well above the 100-point level separating confidence and pessimism.
Households’ views on the 12-month economic outlook rose 2.7 per cent, following a 3.3 per cent slump the previous week.
ANZ senior economist Felicity Emmett said the result was reassuring in light of recent local market falls and US political events.
“The broad-based improvement in confidence last week is encouraging, particularly given the fall in domestic equity prices early in the week and uncertainty surrounding US policy,” she said in a statement on Tuesday.
“(But) stepping back from the weekly numbers, confidence has been trending down since late January and is now back close to its long-run average.”
A weak outlook for wages growth – including slated penalty rate cuts – and a rise in unemployment, to 5.9 per cent, had contributed to recent weaker consumer confidence, Ms Emmett said.
She added that high household debt levels, persistently low wages growth and spare capacity in the labour market meant households risked losing confidence in the medium-term outlook.
Households’ views about their current finances fell 0.9 per cent last week while the future finances index gained a solid 3.0 per cent.
Slightly more people thought now was a good time to buy a house-hold item, with that sub-index rising 0.5 per cent, building on the 1.7 per cent gain over the previous two weeks, and is now close to its long-term trend.
Inflation expectations ticked up, partially reversing the previous week’s fall, with the four-week average sitting at 4.4 per cent.