The sharpest increase in official interest rates in history, alongside the fixed rate mortgage reset, has smashed confidence among Australians paying off a home, as well as renters.
That is according to the latest consumer confidence report from ANZ-Roy Morgan:
Overall consumer confidence fell 0.7pts to 72.6 this week – the third straight week of declines.
The index has now been below 80 for twenty weeks in a row, the longest period since the measure began being measured on a weekly basis in October 2008.
The last time consumer confidence fell below 80 for at least twenty weeks was during the 1990-91 recession, when the survey was conducted monthly.
The index fell this week due to pessimism about personal finances compared to a year ago.
Only 17% of Australians (down 2 percentage points) think their families are financially ‘better off’ than this time last year, compared to 57% (up 4 percentage points) who say their families are financially ‘worse off’ (a new record high for this indicator in 50 years of polling).
Confidence fell to a record low among renters. It is also tracking around record low levels for those paying off homes, as illustrated in the chart above.
With energy prices having just risen by around 25% along the east coast, real wages falling, unemployment rising, and average mortgage payments continuing to rise as fixed rate mortgages roll off, it is hard to see how consumer confidence will rebound anytime soon.
