BankSA State Monitor reveals consumer, business worries over Trump tariffs

A BankSA survey reveals how South Australians have been spooked by US President Donald Trump’s tariffs, in a worrying sign for consumer and business spending.

Shoppers in Rundle Mall.

South Australian consumers are battening down the hatches as US President Donald Trump’s controversial economic plan wreaks havoc on global financial markets, with a BankSA survey pointing to a major pullback on household spending despite some optimism around the prospect of falling interest rates.

BankSA’s quarterly State Monitor shows consumer confidence has increased to 109.9 points – based on a survey taken at the end of February – up 7.3 points from September, when sentiment levels had dipped to their lowest point since the early stages of the pandemic.

The survey coincided with the Reserve Bank’s decision to cut the official cash rate for the first time since November 2020, boosting the consumer confidence index to its highest level since February 2024.

However, when consumers were asked what their main financial goals were for the remainder of 2025, their responses revealed the fragile state of household budgets.

Around 70 per cent of respondents said keeping household finances on a stable footing was the biggest priority, followed by increasing savings (64 per cent), cutting back on spending (61 per cent) and improving household budgeting (52 per cent).

It all points to a gloomy outlook for household spending.

Donald Trump’s tariffs announcements have sent jitters across global financial markets. Picture: Spencer Platt/Getty Images/AFP

BankSA business general manager David Firth said that while there was a positive outlook for the South Australian economy and jobs market, cost pressures and global economic uncertainty were weighing on the minds of both consumers and business owners.

“Some of the external factors identified as supporting optimism among consumers include South Australia’s long-term outlook for the future, employment and income security, and their own household position, although they expressed concern about world affairs and wages relative to the cost of living,” he said.

“Businesses are equally positive about the long-term outlook for South Australia and their own household financial position but are more pessimistic about the cost of energy and availability of property to buy or rent.”

BankSA’s business confidence index dipped slightly in February, falling by 2 points to 118.2, where 100 is considered a neutral level.

While there was a 21 per cent increase in the number of businesses expecting an improved business climate in South Australia over the coming year, there was a 30 per cent drop in the number of businesses that had taken on additional staff in the previous three-month period, and a 21 per cent fall in those planning to hire additional staff over the next three months.

For businesses, the top five financial goals in the year ahead were lifting business turnover (73 per cent), increasing customers (67 per cent), improving customer service (64 per cent), improving efficiency (61 per cent) and reducing business costs (53 per cent).

Originally published as BankSA State Monitor reveals consumer, business worries over Trump tariffs