The Westpac- Melbourne Institute Index of Consumer Sentiment fell 1.5% in September, and has now languished in the deeply pessimistic zone for a year. The only comparable period of such sustained weakness in the index, which has been published since 1974 was during the 1990s recession.
Pessimism has persisted despite easing fears of further interest rate rises. This has seen a clear lift in the confidence of mortgage holders, up 7.8% in the latest month. However, this gain was more than offset by a 6.1% fall in the confidence of renters and a 5.8% fall in the confidence of consumers that own their home outright.
The survey is recording ongoing intense pressures on family finances. Most notably, the sub-index tracking assessments of finances compared to a year ago recorded another 4.4% fall and is now at its lowest level in this current cycle. Those concerns would have been exacerbated by the 15% lift in petrol prices over the last two months, coming on top of already strong rises in rent and electricity