Australia: Consumer sentiment moves back into negative territory in September
September 11, 2019
The Westpac-Melbourne Institute consumer sentiment index dropped from 100.0 points in August to 98.2 points in September. Therefore, it returned below 100-point mark indicating that there were more pessimists than optimists among Australian consumers.
There was an across-the-board deterioration in September. Consumers’ expectations over the general economic situation in the year ahead soured in the month, likely affected by the release of disappointing national accounts data for Q2 and by persistent international trade tensions. Furthermore, consumers’ sentiment regarding their current and future financial situation worsened—which was also reflected in weaker willingness to buy a major household item—weighed down by concerns on sluggish wage growth and low returns on financial assets, and despite the recent interest rate cuts and improving housing market conditions. Recovering house prices in Melbourne and Sidney were probably behind the decreased willingness to buy a dwelling. The only bright spot was that consumers' outlook over the general economic situation in the next five years improved, suggesting households see current economic woes as only temporary.