Australia: Consumer sentiment edges back up in September

The Westpac-Melbourne Institute Index of Consumer Sentiment came in at 97.9 in September, up from August’s 95.5. The index thus remains below the 100 mark, indicating greater pessimism than optimism among consumers.

Disappointing wage growth and the possibility of an interest rate hike in the near future have consumers worried about their finances. An improving labor market has done little to boost consumer confidence, and the RBA’s decision to postpone an interest rate hike at its last monetary policy meeting had a similar effect. Consumer expectations were more upbeat, however, thanks to the economy’s improving outlook.

FocusEconomics Consensus Forecast panelists see private consumption growing 2.4% in 2017, which is unchanged from last month’s forecast. In 2018, panelists also see private consumption expanding 2.4%, which is also unchanged from last month’s forecast.