Australia and New Zealand Banking : Consumer confidence drops into pessimistic territory

Consumer confidence lost 3.1 per cent last week as new snap lockdowns were imposed in south-east Queensland and in Victoria. Critically, confidence dropped below the neutral level of 100 for the first time since the weekend of 31 October/1 November 2020 - just after the end of Victoria's long second lockdown.

Among the subindices, financial conditions declined, with 'current financial conditions' down 5.7 per cent and 'future financial conditions' losing 4.8 per cent.

Economic conditions improved after falling for three weeks. 'Current economic conditions' gained 3.8 per cent, while 'future economic conditions' rose 0.9 per cent.

'Time to buy a major household item' dropped 8.3 per cent. 'Weekly inflation expectations' rose 0.1ppt to 4.3 per cent, pushing the four-week moving average up 0.1ppt to 4.3 per cent.