Consumer confidence in Australia for the week ending July 3, edged lower, following ongoing political uncertainty concerning the domestic Federal elections, the final results of which are due on Tuesday. Further, global turmoil, tracking Brexit referendum on June 23, is also likely to have impacted consumer sentiments last week.
The latest ANZ-Roy Morgan consumer confidence index slid 0.9 percent to 115.8, stretching the decline to near two weeks to 2.5 percent. This followed a decline of 1.7 percent in the last week. Crucially, the index still remains above its long-run average of 112.8.
Further, consumers’ views of their current finances edged 1.6 percent lower, whereas views towards future finances dipped 5.1 percent. However, consumers remained more optimistic of the country's economic outlook. The index measuring consumers’ economic outlook within the next 12 months jumped 4.7 percent, while that in the next five years rose 1.7 percent.
“Confidence has edged lower in the past two weeks after reaching a two-and-a-half year high. While the recent turmoil in financial markets has likely played a part, we believe that a larger contributing factor in this week’s fall is likely to have been uncertainty related to the Federal Election,” said Felicity Emmett, Head, Australian Economics, ANZ.
Consumers’ views towards the economic outlook have been on an upward trend since the start of the year, although they remain well below their long-run average. Meanwhile, consumers’ views towards whether 'now is a good time to buy a major household item' fell 2.5 percent.
In contrast to views on personal finances which remain well above their long-run averages, ANZ note that perceptions towards the economic outlook remain well below average, even with a steady improvement seen since the beginning of the year. However, more than the ambiguity over the election outcome, the actual result is expected to deliver greater damage to consumer confidence in the near term.
The material has been provided by InstaForex Company – www.instaforex.com