Consumer confidence takes a bite
Higher interest rates and rising fuel and food costs are putting a significant amount of pressure on consumer spending, suggesting that the work of the Reserve Bank of Australia and independent unofficial interest rate increases are now taking effect. This month, the Westpac-Melbourne Institute index of consumer confidence hit its lowest point since mid-1993, sliding 1.3 per cent to reach 87.4 points. Difficult times lie ahead for retailers as household intentions to make major purchases have been increasingly dampened. Westpac senior economist, Matthew Hassan said “consumer sentiment had been hit hard by successive interest rate rises, sharemarket falls and rising living costs”. The average monthly fuel bill is estimated to have increased 12 per cent over the year, now $196, as the national average price hovers in the range of $1.40 a litre.
Source: The Australian Financial Review