Login
ISCOVER
Consumer confidence has dropped in the week to 20 October, according to the Roy Morgan Consumer Confidence rating.
The fall in confidence of 1.4 points from its highest level since January 2011 has been attributed to a fall in confidence regarding the Australian economy over the next five years and a decline in respondents’ financial situations compared to this time last year.
To continue reading the rest of this article, please log in.
Looking for more benefits? Become a Premium Member.
Create free account to get unlimited news articles and more!
Looking for more benefits? Become a Premium Member.
Only 39 per cent of respondents expect the economy to have "good times" over the next five years, a drop of three per cent.
The research also showed 24 per cent of Australians said they are "worse off" financially than this time last year, an increase of two per cent from the previous poll.
Gary Morgan, executive chairman of Roy Morgan Research, said the fall may be a delayed reaction to the US government shutdown and debt ceiling concerns.
“Both issues had caused uncertainty in global markets and their resolution, at least for the next few months, allows businesses to concentrate on growing again rather than worrying about a potential ‘adverse shock’ to the global economic system,” he said.
Mr Morgan said the Australian Securities Exchange (ASX) had already reacted to the news out of the United States, with the All Ordinaries rising to its highest level since June 2008 and the Australian dollar at its highest level in over four months.
“However, despite the positive developments, Australians are less confident about the Australian economy over the next five years, with 39 per cent (down three per cent) of Australians expecting ‘good times’,” he said.
“The renewed strength in the Australian dollar will hurt many industries in Australia, including manufacturing, agriculture, mining, tourism and education.”
Mr Morgan called on the government and the Reserve Bank (RBA) to do what it can to improve productivity and rebalance the Australian dollar.
“It is imperative that the Abbott government implements workplace reform to improve the productivity of the Australian workforce, and that the RBA cuts interest rates on the first Tuesday of November to support Australian businesses and allow the Australian dollar to return to a more sustainable level,” he said.
