Australian consumer confidence plunges to worst level since 1990s after RBA rate rise

Australian consumer confidence has dropped to its lowest level since the early 1990s recession, following a fourth interest rate rise this year by the Reserve Bank of Australia (RBA). The Westpac–Melbourne Institute consumer sentiment index revealed a 20% decline in confidence since the RBA raised interest rates to their highest levels since 2011.

Key Findings

The confidence index fell by 4.7% to 80.4 in October.
For respondents surveyed after the RBA's announcement on 29 September, the index plummeted to 67.2, marking the lowest level since the late 1990s.
The weekly ANZ-Roy Morgan consumer survey also reflected a decline, dropping about 5% to 67.1 points.

Context

Matthew Hassan, Westpac’s head of Australian macro-forecasting, noted that consumer sentiment has been extremely weak for the longest period since the recession of the early 1990s. He stated,

“

"Australian consumers remain stuck in a cost-of-living nightmare that seems to have no end in sight. The latest RBA move looks to have badly rattled consumers."

Comments

Key Findings

The confidence index fell by 4.7% to 80.4 in October.
For respondents surveyed after the RBA's announcement on 29 September, the index plummeted to 67.2, marking the lowest level since the late 1990s.
The weekly ANZ-Roy Morgan consumer survey also reflected a decline, dropping about 5% to 67.1 points.

Context

Matthew Hassan, Westpac’s head of Australian macro-forecasting, noted that consumer sentiment has been extremely weak for the longest period since the recession of the early 1990s. He stated,

“

"Australian consumers remain stuck in a cost-of-living nightmare that seems to have no end in sight. The latest RBA move looks to have badly rattled consumers."