by Alan Thornhill
Consumer confidence has fallen sharply in Australia, despite two recent rate cuts.
The Westpac Melbourne Institute Index of Consumer Sentiment, which has just been released, shows confidence falling by 8.3 per cent this month.
Westpac’s Chief Economist, Bill Evans said: “The Index has now fallen to its lowest level since August this year.”
The bank is blaming news of both the European debt crisis and economic conditions for the fall.
People who responded to the survey had seen the news on local economic conditions, international conditions, the Budget and taxation as the worst since the global financial crisis.
“Despite the positive perception of interest rates the confidence of respondents with a mortgage fell by 9.5 per cent,” Mr Evans said.
“Specific news which is likely to have unnerved respondents is the reported increase in the unemployment rate from 5.2 per cent 5.3 per cent with a loss of 40,000 full time jobs,” he added.
“Of course, the constant stream of news on developments in Europe is also likely to have impacted respondents, while equity markets were volatile,” Mr Evans said.
He said respondents were worried about economic conditions in the year ahead and both current and future family finances.
“The sub-index tracking views on “whether now is a good time to buy a major household item fell by 3 per cent,” Mr Evans said.
He said, too, that risk aversion increased markedly in this survey
Alan Thornhill is a parliamentary press gallery journalist.
Private Briefing is updated daily with Australian personal finance news, analysis, and commentary.
Tuesday December 10
The Dow Jones index rose 6 points to 16,026
Holden boss Mike Devereux refuses to answer Productivity inquiry questions on government funding.
Acting PM Warren Truss writes to Mike Devereux seeking “a clear statement” on Holden’s future
In October 2013, the total number of owner occupied housing finance commitments rose 1.0 per cent:ABS
The Federal Treasurer, Joe Hockey, says the Mid-Year Economic and Fiscal Outlook will be released next Tuesday, at the National Press Club.
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|Macq Group Fpo||52.180||+0.630||+1.22%|
|Origin Ene Fpo||13.280||-0.200||-1.48%|
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