Roy Morgan Research (RMR) last night released its weekly consumer confidence index, which retraced for a third straight week after recently hitting two-and-a-half year highs.
Over the week ended 2-3 of November, the RMR index fell by 0.4 points to 120.5, driven by a decrease in confidence about about respondents’ financial situations (see next chart).
The index is now down 3.7 points (-3.0%) from the high reached in the weekend of 12-13 October, although it remains elevated relative to recent experience.
According to Gary Morgan:
Consumer Confidence is virtually unchanged this week at 120.5 (down 0.4pts). Expectations of personal financial situations fell slightly with 39% (down 4%) of Australians expecting their family will be ‘better off’ financially this time next year and 32% (down 2%) of Australians saying they are ‘better off’ financially than this time last year.
“Consumer Confidence was measured before the RBA left interest rates unchanged at a record low 2.50% on Melbourne Cup Day. Interest rates are also expected to remain unchanged through into 2014 as the US Government again faces a ‘battle’ to increase the US debt ceiling (due to expire in February 2014) and also keep the US Federal Government open (The US Government is funded only until mid-January 2014).
“Both of these issues will impact on the Australian economy in the New Year, however, the record low interest rates in Australia should support the Australian retailing industry during the important Christmas retailing season. Recent figures show strong growth in the housing market around Australia and also strong growth in Australian retail – retail turnover in Australia grew a strong 0.8% according to the latest ABS figures.
Here’s how the RMR consumer confidence index is tracking against the monthly Westpac-Melbourne Institute consumer sentiment index:
Now that’s one strong correlation!
