Consumer confidence fell at the weekend, an ANZ survey suggests, as people appeared to view the Reserve Bank’s latest cut to the cash rate as a sign of worsening economic conditions.
The ANZ-Roy Morgan Australian Consumer Confidence index dipped 1.1 per cent from the previous week, with respondents’ perception of the economy, including the outlook for the next 12 months, retreating 3.6 per cent and prospects about conditions in the next five years sliding 1.7 per cent.
But the weekly measure of sentiment, which is based on about 1,000 face-to-face interviews on Saturdays and Sundays, recorded a 3.7 per cent rise in how people felt about their financial condition compared with a year ago and a 1.3 per cent increase regarding their finances during the next 12 months.
The survey was taken after the RBA cut interest rates for the second month in a row on July 2 to a record low 1.0 per cent and follows the federal parliament’s approval of tax cuts on Thursday.
ANZ economist David Plank noted consumer confidence was lower after the most recent RBA decision and added the “passage of the tax cuts has also not been an immediate boost to sentiment”.
There was also a 4.6 per cent fall in the “time to buy a major household item” metric and the poll indicated a marginal increase in inflation expectations.
“Interestingly, confidence also fell immediately following the June RBA rate cut, suggesting the immediate takeaway from monetary easing is not necessarily positive,” Mr Plank said.