Consumer sentiment has risen again and is now well above pre-pandemic levels.
In fact it’s the highest it’s been since November 2013 according to the NAB.
These findings are in line with ANZ Roy Morgan’s weekly consumer confidence index which is reason for the 10th consecutive week and the consumer sentiment survey results announced by Westpac
Consumer sentiment rose again in November, up 2.5% to 107.7, and is now at its highest level since November 2013.
Compared to prior downturns, the recovery in consumer sentiment is the sharpest seen in the history of the series and reminds of the unusual nature of this shock and the extensive government support provided to households (and businesses)
This month’s rise was driven by Victoria, where confidence lifted 9.0% to 111
Business confidence also rose strongly in Victoria in the NAB Business Survey released yesterday.
It will be interesting to see what impact the sharp lift in confidence may have on activity in Q4 as the phasing back of JobKeeper and JobSeeker also occurs.
The Consumer Confidence survey typically does not give a strong indication of consumer spending trends, but last month signalled a positive reaction to the budget’s income tax cuts and this month likely reflects Victorian reopening, which will boost activity in that state in the near term.
Retailers continue to report the strongest business conditions of any business in the NAB survey, so the broad messages align between the two surveys.
Consumer confidence rose 2.5% in November to 107.7.
The sub-components were mixed, though with the levels still being healthy overall.
Expectations for the economy lifted further with the 1yr ahead expectation +8.4% and 5yr ahead +0.2%. In contrast, family finances were flat to lower with family finances v. a year ago -3.2% and for the year ahead +0.2%).
Historically, the time to buy a major household item and family finances have had a reasonable but low correlation with durable goods consumption.
On housing, the survey reports improving sentiment among consumers with another sharp rise in the “time to buy a dwelling’, up +8% to 132.0.
House prices appear to have stabilised in recent months.
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