Consumer confidence fell in the past week with ongoing concerns around import tariffs between the US and China fuelling fears of worldwide trade war.
The latest ANZ-Roy Morgan Consumer Confidence index shows a 0.9 per cent drop to 117.4 points in the week to March 25, with optimism about future financial conditions outweighed by concerns around the economic outlook.
Households’ views towards current financial conditions were down 3.1 per cent but confidence around future financial conditions rose 2.8 per cent to its highest level since February last year.
Sentiment around current economic conditions dropped 6.8 per cent, marking its lowest value in 18 weeks, while future economic conditions fell to a five-week low.
ANZ’s senior economist Felicity Emmet said US President Donald Trump’s import tariffs of 25 per cent on steel and 15 per cent on aluminium products were likely to blame for the past week’s confidence decline.
‘”Last week’s back-and-forth on import tariffs between the US and China roiled global and domestic equity markets, fuelling fears of retaliatory measures by governments worldwide,” Ms Emmet said.
“This is likely responsible for the sharp deterioration households’ views around the economic outlook.”
Ms Emmet said the unexpected up tick in the unemployment and underemployment rate in February may have also impacted the overall index.
The unemployment rate was 5.6 per cent in February, up from January’s 5.5 per cent, and slightly above market expectations.