Australian consumers turn glum on inflation, floods

[SYDNEY] A measure of Australian consumer sentiment fell for a fourth straight month in March as rising inflation, the impact of floods and the conflict in Ukraine all darkened the economic outlook.

The Westpac-Melbourne Institute index of consumer sentiment released on Wednesday slid 4.2 per cent from February, when it fell 1.3 per cent. The index was down 13.6 per cent from March last year at 96.6, and the lowest since September 2020.

"The latest monthly fall comes as no surprise," said Westpac chief economist Bill Evans.

"The war in Ukraine; the floods in southeast Queensland and northern NSW (New South Wales); ongoing concerns about inflation and higher interest rates were all likely to impact confidence, although the size of the decline is still notable."

While respondents remained upbeat on the jobs market, 77 per cent viewed news on the economy as negative, compared to 43 per cent a year ago. Some 83 per cent were negative on inflation news and 87 per cent on international conditions.

The impact was clear in the survey's measure of the economic outlook for the next 12 months which dropped 6.7 per cent, while the outlook for the next five years fell 5.6 per cent.

The index on family finances compared with a year ago eased 3.9 per cent, while the outlook for finances over the next 12 months fell 0.4 per cent.

The survey's measure of whether it was a good time to buy a major household item fell 4.4 per cent, while the 'time to buy a dwelling' index fell 7.7 per cent. REUTERS