Australia’s consumer confidence declined to near historic lows in October amid a surge in the cost of living, rising interest rates and concerns about the near-term economic outlook, survey results from Westpac showed on Tuesday.
The Westpac Melbourne Institute Index of Consumer Sentiment fell 0.9 percent to 83.7 in October from 84.4 in September.
The survey suggested that the latest fall could have been significantly worse if the Reserve Bank had chosen to raise the cash rate by 50 basis points instead of the 25 basis points it delivered at its October meeting.
The survey of 1200 respondents has been conducted over the four days from October 3 to October 6.
Westpac expect four more consecutive quarter point rate hikes at the November, December, February and March meetings.
Within overall consumer confidence index, the ‘family finances vs a year ago’ sub-index gained 1.1 percent on month, but to a still very weak level of 69.3, and the ‘family finances, next 12 months’ sub-index was down 0.4 percent.
Meanwhile, the ‘time to buy a major household item’ sub-index climbed 1.6 percent.
The ‘economic outlook, next 12 months’ sub-index recorded the biggest decline for the month, down 4.2 percent, and the ‘economic outlook, next five years’ sub-index dropped 2.1 percent.
Further, the ‘time to buy a dwelling’ index declined 6.4 percent to 75.3. This index has been in the 75-80 range since March this year.
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