ANZ, Roy Morgan: Consumer confidence declines due to COVID-19
Consumer confidence has slipped as fears of a second lockdown do further damage to the economy.
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Renewed fears of a second national lockdown have caused consumer confidence to slip, fuelling concerns that Australia’s economic recovery could be stifled.
Latest research by ANZ and Roy Morgan shows confidence fell 0.5 per cent in the last week — its third weekly decline.
Its report noted deteriorating conditions in Melbourne are driving the anxiety, with economic sentiment conditions falling 3.4 per cent over the week.
ANZ head of Australian economics David Plank said government support measures were predominantly “shielding” people from the full brunt of the financial downturn.
“In contrast, sentiment toward personal finances is close to unchanged, highlighting the role that the massive fiscal stimulus has played in shielding people from the direct fallout of the economic slump triggered by the health response to the pandemic,” Mr Plank said.
In a separate monthly survey conducted by NAB Group Economics, business conditions and confidence are showing signs of improvement but remain deeply negative.
NAB’s business conditions rose 17 points to negative seven index points, rebounding from the historical lows experienced at the beginning of the pandemic.
The bank noted improved operating conditions in retail and mining sectors had led to the rise in sentiment.
NAB chief economist Alan Oster said the survey was conducted prior to the reintroduction of lockdowns in Victoria, which will likely dent business recovery.
“The increase was broad based across industries, but it is important to remember that given the prior large fall conditions still remain very weak overall,” Mr Oster said.
“Conditions and capacity utilisation remain very weak and will take some time to recover.”
Mr Oster flagged employment confidence over the month of June rose 20 points to an index position of negative 11 points, however the outlook remains considerably weak.
“The improvement in the employment index is very welcome, but is at a very low level and suggests that the labour market has a long way to travel before we can claim a full recovery,” he said.
Both conditions and consumer reports coincide with weekly payroll data released by the Australian Bureau of Statistics that note job losses were at 5.7 per cent at the end of June.
Originally published as ANZ, Roy Morgan: Consumer confidence declines due to COVID-19