Australian consumer sentiment dips further in April, big-ticket purchases decline

Economic anxiety deepens: Consumer sentiment in Australia took another hit in April as concerns about the economy continued to weigh heavily on the minds of Australians, according to a recent survey. The latest Westpac-Melbourne Institute index revealed a 2.4 per cent decline in consumer sentiment from March, marking a continued trend of pessimism that has persisted for nearly two years.

Continued consumer worries

Senior economist Matthew Hassan from Westpac noted that despite ongoing economic challenges, there are few signs of improvement in the consumer outlook. Worries about inflation and the slow progress in addressing cost-of-living pressures persist, contributing to the prevailing pessimism. 

Moreover, consumers remain sceptical about the possibility of interest rate cuts, despite the Reserve Bank of Australia maintaining rates at a 12-year high of 4.35 per cent in March.

Tax cut boost

Although there has been some positive movement in indicators such as family finances compared to a year ago and the outlook for finances over the next 12 months, largely fuelled by anticipated tax cuts scheduled for July, overall economic sentiment remains subdued. Perceptions of the economy over the next year and the next five years both experienced declines, indicating a lack of confidence in long-term economic prospects.

Furthermore, there was a notable decline in buyer sentiment, particularly regarding the purchase of major household items, with the relevant index dropping by 6.6 per cent. This suggests that consumers are increasingly cautious about making important purchases amidst economic uncertainties.

(With Reuters Inputs)