Consumers shrug off weak wage growth: ANZ

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(Australian Associated Press)

Consumer confidence rose across the board last week despite continuing weakness in wage growth.

The ANZ-Roy Morgan Australian Consumer Confidence Survey shows that sentiment jumped 4.7 per cent to 119.1 in the week ended February 26, remaining well above the 100-point level separating confidence and pessimism.

ANZ senior economist Jo Masters said the marked improvement in confidence was consistent with the strong start to the year in the housing market and gains on the local stock market.

“Importantly, views towards current financial conditions recovered strongly after the surprisingly large fall the previous week,” Ms Masters said in a statement.

“Overall, consumers have remained upbeat about their finances over the past six months, with the index holding well above its long term average despite ongoing soft wage growth.”

Wages and salaries fell 0.5 per cent in the December quarter, figures from the Australian Bureau of Statistics showed on Monday, and grew just one per cent last year.

Survey respondents’ views of their current financial conditions compared to one year ago jumped 9.3 per cent and they were 6.3 per cent more upbeat about their future finances.

Consumers were also more optimistic about the wider economic outlook, with their views about economic conditions over the next 12 months up 4.4 per cent and their views about economic conditions over the next five years up 1.7 per cent.

The “now is a good time to buy a major household item” subindex also rose 2.5 per cent to its highest level in six weeks.

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