Australia: Consumer sentiment weakens in April
April 11, 2013
In April, the index of consumer sentiment published by Westpac and the Melbourne Institute eased to 104.9 points. The reading was down from the 110.5 points recorded in March, which had marked the strongest result since December 2010. Nonetheless, the figure represents the fifth consecutive month in which the index has been at or above the 100-point threshold that separates optimistic from pessimistic territory.
According to Westpac and the Melbourne Institute, the result comes as a surprise. However, "the disturbing news around Cyprus with associated risks around European stability may have unnerved respondents".
The deterioration was broad-based, as all the five components of the index fared worse compared to March. In particular, households' expectations for the general economy in the long run (5 years) recorded the strongest drop. Against this backdrop, the sub-index related to the intentions to purchase major household items fell 7.6% over the previous month.
FocusEconomics Consensus Forecast panellists see private consumption growing 2.4% in 2013, which is down 0.1 percentage points from last month's forecast. Panellists see private consumption expanding 3.1% in 2014.
Author: Armando Ciccarelli, Head of Data Solutions