ANZ Roy Morgan index was down 1.2% last week, its second straight weekly loss – ensuring confidence remains below its long-run average.
The financial conditions subindices were positive. Current finances gained 0.2%, while future finances were up 0.7%. These small gains coming after large falls last week.
In contrast weakness in the economic conditions subindices continued for a second week. Current economic conditions fell 1%, while future economic conditions lost 1.7%.
The ‘Time to buy a household item’ measure fell 3.9% after two successive gains.
Inflation expectations (IE) remained stable at 4.1%.
Consumer confidence was down 1.2% last week, despite some positive developments in the US-China trade war. The decline leaves overall sentiment below average. Household perceptions of the economic outlook fell for a second consecutive week and are well below average. It will be interesting to see whether economic sentiment can gain this week as households have more time to consider the news on trade. In contrast to the negative economic outlook, households remain much more confident about their own financial outlook. This week’s employment data could be important in this regard. Stable inflation expectations, albeit at a low level by historical standards, will be comforting for the RBA.
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
