Household confidence withstanding rising costs

WA household confidence is withstanding the pressure of rising prices and interest rates, edging higher in the three months to June, CCIWA’s latest Consumer Confidence Survey shows.

Buoyed by the easing of domestic COVID-19 restrictions and tightness in the local jobs market, the June survey report found more West Australians expect the economy to improve (28 per cent), than expect it to weaken (22 per cent) in the next three months. Confidence over the coming year also improved, with two in five (43 per cent) expecting conditions in the economy to strengthen.

cost of living

It reverses the balance last quarter, when more Western Australians anticipated weaker conditions.

LEARN MORE: Access the Consumer Confidence Survey Report 

Overall, ‘living costs’ became the single biggest drag on consumer confidence this quarter (76 per cent), reflecting anxieties around persistent supply chain disruptions and rising inflationary pressures.

Interest rate rises also weighed heavily, with 58 per cent identifying interest rates as reducing confidence – up 22 percentage points since last quarter. Globally, the war in Ukraine (59 per cent) also affected consumer pessimism.

Amid this jobs boom, West Australians continue to reassess their work preferences, with two in every five (41 per cent) actively looking for a new job, with younger people the most driven (55 per cent). Fewer West Australians are interested in a “nine-to-five”, with one third (31 per cent) of respondents willing to accept less pay in exchange for more flexible hours and conditions.

“Looking forward WA households will undoubtedly feel rising pressure from interest rates and other forces, however significant additions to savings balances and mortgage offset accounts will hold the local consumer economy in good stead,” CCIWA Chief Economist Aaron Morey said.

 

For the latest economic reports see CCIWA’s Economic Insight page.

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