Australia: Consumer sentiment falls to nine-month low in February
February 12, 2014
The Westpac-Melbourne Institute Survey of Consumer Sentiment fell to 100.2 points in February, which was down from the 103.3 points tallied in January and marked the lowest print since May 2013. As a result of February's drop, the indicator is virtually resting on the 100-point threshold that separates optimistic from pessimistic territory.
The deterioration in consumer sentiment was mainly the consequence of worsening expectations regarding future economic conditions. The Institute specifically mentioned that, "the difference between the current conditions index and the expectations index widened further and is now at its highest level since June 2000." Moreover, consumers were more pessimistic about future financial conditions, as the interest rate is, "expected to rise over the next 12 months." The recent slowdown in the automobile industry, which has prompted the announcement of important factory closures, also contributed to the decline in consumer confidence.
FocusEconomics Consensus Forecast panelists see private consumption growing 2.6% in 2014, which is unchanged from last month's forecast. In 2015, panelists see private consumption expanding 2.9%.