Roy Morgan consumer confidence falls despite RBA cut

Roy Morgan’s weekly consumer confidence number has fallen 2 points despite last week’s 50bps RBA rate cut. It’s not a huge fall and might be put down to statistical noise. Also, telegraphed cuts tend to get priced in beforehand, as we saw through the second half of last year. Then again, maybe consumers sense a little panic.

Consumer Confidence is at 110.3pts (down 2.1pts in the last two weeks) according to the Roy Morgan Consumer Confidence Rating conducted last weekend (May 5/6, 2012). Consumer Confidence is now 9.4points lower than a year ago, May 7/8, 2011 (119.7).

The fall in Consumer Confidence has been primarily driven by a large fall in confidence about economic conditions in Australia over the next 12 months, however there is an increasing number of Australians saying now is a ‘good time to buy’ major household items.

Australians are less confident about Australia’s economy over the next twelve months with 27% (down 6%) of Australians expecting ‘good times’ economically over the next twelve months (the lowest since August 13/14, 2011) compared to 37% (up 5%) of Australians that expect Australia to have ‘bad times’ (the highest since November 26/27, 2011).

However, an increasing majority of Australians 57% (up 3%) say now is a ‘good time to buy’ major household items while just 20% of Australians (down 2%) say now is a ‘bad time to buy’ major household items.

Now 29% (down 1%) of Australians say their family is ‘better off’ financially compared to a year ago while 33% (up 2%) say their family is ‘worse off’ financially.