The ANZ-Roy Morgan consumer confidence index has registered its second consecutive increase, rising 2.2 points to 113.6, to be tracking just above the long-run average of 112.7 (see next chart).
The improvement was broad-based with all five sub-indices rising.
ANZ’s chief economist, Warren Hogan, noted that positive domestic economic conditions are currently outweighing global fears:
Domestic economic fundamentals appear to be overpowering concerns about the international situation in consumers’ assessment of the economic and financial environment. The heightened debate over tax policies appears to have had little detrimental effect on sentiment last week, although we doubt this reading would have captured the impact of the major parties’ announcements on negative gearing.
The ANZ-Roy Morgan index is now back above its long run average, having risen by just over 2% in the last two weeks. This week, all five sub components of confidence rose, seemingly in reflection of an underlying sturdiness in consumers’ attitudes. This is consistent with recent strong employment outcomes as well as good outcomes in residential property last week. The turnaround in sentiment has occurred despite ongoing weakness in equity markets and concerns about the health of the world economy across most media channels.
The below chart plots the most recent Westpac-Melbourne Institute Consumer Sentiment index against the latest ANZ-RM Consumer Confidence index, with both stuck around neutral:
