Australia’s ANZ-Roy Morgan consumer confidence jumps on healthy improvement in financial conditions

Australia’s ANZ-Roy Morgan consumer confidence jumped by 4 percent, one of the largest increases in a year. On an absolute level, the index is at a two-month high. Financial conditions indices were mixed, with current finances down 2.2 percent, while future financial conditions rose 1.0 percent.

Economic conditions were up by a healthy margin. Current economic conditions gained 13.3 percent after falling for three consecutive weeks. Future economic conditions also showed strength, gaining 7.0 percent, a rise that came after four straight weekly losses.

The ‘Time to buy a major household item’ was up 3.2 percent, taking it close to the levels seen last July. The four-week moving average for inflation expectations was stable at 3.9 percent, although the weekly reading fell to 3.7 percent.

"Confidence was up by a healthy margin on the back of a strong performance by the economic conditions sub-indices. The strength may have reflected better global sentiment arising out of the G20 summit in Osaka and evidence that house prices are stabilising in Sydney and Melbourne. The further gain in the ‘time to buy’ index suggests sentiment toward housing is improving. The RBA decision on the cash rate may impact sentiment this week, though as we saw in June the immediate impact of a rate cut is not always positive," said David Plank, ANZ’s Head of Australian Economics.