Consumer confidence eased in the past week but the ongoing improvement in labour market conditions may yet spell good news for retailers over the holiday season.
The latest ANZ-Roy Morgan Consumer Confidence Index showed a 1.2 per cent slip to 115 in the week to November 26 on doubts about the current and future state of the economy.
But the slight pullback did not reflect the overall positive trend in consumer sentiment, according to ANZ head of Australian economics David Plank.
Consumer sentiment in the ‘time to buy a household item’ subindex rose slightly, returning to the long term average of 133.8 just in time for the retail run at Christmas.
“A sustained improvement will likely bode well for holiday season sales,” Mr Plank said.
Mr Plank said improvements were driven primarily by ongoing labour market strength, supported by leading business indicators that point to further improvements in labour market conditions.
Consequently, Australian household perspectives on overall economic conditions are at their highest point since February and remained above their long-term averages.
“Despite last week’s fall, sentiment towards economic conditions has improved considerably since its low point in early September,” Mr Plank said.