The ANZ-Roy Morgan consumer confidence index registered its second consecutive fall in the week ended 27 March 2016, declining 1.5 points to 114.5, although it is still tracking above the long-run average of 112.7 (see next chart).
The fall in overall confidence was driven by declines in the sub-indices measuring family finances compared with a year ago (-4.1%) and economic conditions over the next 12 months (-5%).
ANZ’s head of Australian economics, Felicity Emmett, pinned the fall in confidence on the uncertainty around an early election, given Australia hasn’t had a double dissolution election since 1987. She also noted that “the government’s decision to bring forward the Commonwealth budget is likely to put the issue of strained public finances firmly at the front of consumers’ minds” and suggested that the latest falls on the share market may also have played a role.
The below chart plots the most recent Westpac-Melbourne Institute Consumer Sentiment index against the latest ANZ-RM Consumer Confidence index, with both still somewhat divergent:
