ANZ-Roy Morgan Consumer Confidence was virtually unchanged at 87.7 this week, at its highest level for over three months since late September 2022 (87.8). However, consumer confidence is a large 10.5pts below the same week a year ago, January 10-16, 2022 (97.9).
Consumer confidence is now only 1pt below the 2022 weekly average of 88.7.
The stagnation sits alongside small increases in confidence relating to personal financial situations, while there was virtually no change in views on the Australian economy and whether now is a good or bad time to buy major household items as many Australians continued to enjoy their summer holidays.
Consumer confidence was mixed around Australia, however it was up in Victoria and Western Australia for the first time this year, and dropped in NSW, Queensland and South Australia.
Victoria is the only mainland state where consumer confidence increased for the first two weeks of 2023.
Across the index, 22% of Australians still say their families are ‘better off’ financially than this time last year, compared to 43% (down 2ppts) that say their families are ‘worse off’ financially.
Looking forward, over a third of Australians (35% - up 2ppts) expect their family to be ‘better off’ financially this time next year, which is the highest figure for this indicator for nearly a year since March 2022. 29% (up 1ppt) expect to be ‘worse off’.
Only 8% (down 1ppt) of Australians expect ‘good times’ for the Australian economy over the next twelve months, compared to slightly fewer than a third (31% - down 1ppt) that expect ‘bad times.’
Sentiment regarding the Australian economy in the longer term is still very weak and remains unchanged, with 14% of Australians expecting ‘good times’ for the economy over the next five years, compared to 17% expecting ‘bad times’.
When it comes to buying intentions, over a quarter (26% - unchanged) of Australians, say now is a ‘good time to buy’ major household items while 46% (up 1ppt) say now is a ‘bad time to buy’.
ANZ senior economist Adelaide Timbrell said consumer confidence had only increased slightly by 0.3pts in the second week of the year.
“The ‘financial situation next year’ sub-index rose to its highest since late April 2022, before increases in the cash rate began,” Timbrell said. “It is worth noting that stronger confidence is not necessarily a leading indicator of stronger spending. ANZ-observed spending data shows weaker spending in the first week of 2023 compared to the previous year.
“Household inflation expectations jumped 0.4ppt, but are still 0.5ppt lower than the end of last year.”