Roy Morgan Research (RMR) has released its weekly consumer confidence index, which registered its first fall for 2013. It was also the lowest January recording since 2009 – during the Global Financial Crisis.
Over the week ended 18-19 January, the RMR index fell by 1.2 points to 116.3, driven mainly by respondents having less confidence about their own personal financial situation (see next chart).
The index is now up 4.5 points (4%) from the trough reached in the final week of December.
According to Gary Morgan:
Roy Morgan weekly Consumer Confidence has fallen for the first time in the New Year – down 1.2pts to 116.3. The fall takes Consumer Confidence back to the December 2013 average of 116.3 and is the lowest January Consumer Confidence since 2009 – during the Global Financial Crisis.
“Driving Consumer Confidence lower was falling confidence about personal financial situations with 30% (down 3%) of Australians saying they are ‘better off financially’ than this time last year and 40% (down 2%) of Australians saying they expect to be ‘better off financially’ this time next year.
“The drop in Consumer Confidence means the RBA must cut Australia’s interest rates (currently amongst the highest in the developed world at 2.5%) at their first meeting for 2014 – due in two weeks on Tuesday February 4. Along with declining Consumer Confidence, the latest Roy Morgan December employment figures show a record 2.5 million Australians (19.8%) are either unemployed (1.4 million) or under-employed (1.1 million). The Australian economy requires stimulus from both the RBA cutting interest rates, and the Abbott Government undertaking significant reforms to Australia’s labour markets to allow strong employment growth throughout for all Australians looking for jobs.”
Here’s how the RMR consumer confidence index is now tracking against the monthly Westpac-Melbourne Institute consumer sentiment index, whose most recent reading for December registered a sharp fall:
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