Australian consumers spooked by poor GDP data
A measure of Australia's consumer sentiment slipped to an eight-month low in December after disappointing economic data shook confidence in the outlook for the year ahead.
Wednesday's survey of 1200 people from the Melbourne Institute and Westpac Bank found consumer sentiment fell 3.4 per cent in December, from November when it dipped 1.1 per cent.
The fall in consumer confidence could be a worry for retailers in the Christmas shopping season.Credit:Paul Jeffers
That took the index down to 97.3, implying pessimists now outnumbered optimists.
"It is likely that the key reasons behind this fall in confidence are related to renewed concerns around the economy, interest rates, and the labour market," said Westpac chief economist Bill Evans.
The survey was taken in a week where data showed the Australian economy shrank by 0.5 per cent in the third quarter, the first contraction since 2011.
Asked which news items they recalled the most, respondents cited "economic conditions" followed by "budget and tax", and "interest rates". All the news was rated predominantly as "unfavourable".
The survey's measure of expectations for the economic outlook over the next 12 months duly slid 5.2 per cent, while economic conditions for the next five years fell 2.5 per cent.
The measure of family finances compared to a year ago dipped 2 per cent, while family finances over the next 12 months dropped 1.8 per cent.
The measure of whether this was a good time to buy major household items sank 7 percent. That could be a worry for retailers into the crucial Christmas shopping season, though the correlation between sentiment and actual sales is loose, to say the least.
The 'time to buy a dwelling' index bucked the trend to rise 2.6 per cent, mainly thanks to a sharp recovery in confidence in the Sydney property market.
Reuters