Australia: Consumer confidence moderates in June
June 15, 2016
The Westpac-Melbourne Institute Survey of Consumer Sentiment fell 1.0% in June as the index dipped from 103.2 in May to 102.2. June’s reading above 100 indicates that the number of optimists is greater than the number of pessimists, although less so compared to the situation in May.
The institute noted that consumers were more pessimistic regarding their reaction to news, particularly economic or budgetary news items. Attitudes toward risk had become less averse in June; however, Australians are still more risk averse compared to levels seen in 2015. The institute pointed out in its accompanying report that as June’s slight decrease followed a major improvement in May, the minor dip was somewhat expected. Particularly, the institute stated that, “coming after an 8.5% surge in May, the small decline in June mostly represents a consolidation at improved levels. Last month’s surprise rate cut from the RBA was the main catalyst behind May’s rally and although confidence has slipped back a touch in June this is a fairly common pattern following an interest rate driven bounce.”
Author: Robert Hill, Economist