Australian Consumer Confidence Takes a Dive

02 February 2007

SYDNEY: Hot on the heels of a sunny local economic forecast for 2007, courtesy of the Westpac/Melbourne Institute [WARC News; 19-Jan-07], comes doom and gloom from a consumer confidence index which highlights employment worries and quality of life concerns.

MasterCard's latest MasterIndex shows a drop in consumer confidence for the first half of 2007 to 45.3, down 1.2 index points from the last reading six months ago.

The drop marked the sixth consecutive fall for the index, with the overall confidence reading currently 4.5 points down on the same period in 2006.

The quality of life category saw the steepest slide, falling 14 points from six months ago to 25.5 points. Confidence in the job market was also knocked and stood at 36.1 points.

There was some cheer, however. Oz citizens remain optimistic about their regular income. The index fell only slightly in the category, from 73.3 to 71.1 points.

MasterCard's Asia/Pacific economic adviser, Dr Yuwa Hedrick-Wong, says the index had been affected by a deteriorating work-life balance.

He avers: "A plausible explanation . . . could be Australians' higher expectation today in wanting more out of life. But [they are] finding it more difficult to achieve due to the demand for longer working hours and more intense competition in the job market."

Data sourced from Sydney Morning Herald; additional content by WARC staff