West Australians are heading into the festive season with wary optimism, despite growing cost-of-living pressures.
CCIWA’s quarterly Consumer Confidence report has found two in five (41%) of WA households expect to spend the same amount as they did last year, while one in five (21%) expect to spend more. Two in five (39%) expect to rein in their spending.
West Australians are predicted to spend around $5.1 billion during the holiday period.
CCIWA Chief Economist Aaron Morey said despite the steady consumer sentiment heading into Christmas, more WA households were experiencing financial stress than this time last year.
“We’ve seen a seven percentage point increase in the number of WA households experiencing financial stress compared with the same time last year,” he said.
“59% of WA households have told us they’ve experienced one financial stressor in the last three months, and 28% experienced at least two.
“The fact that more than half expect to spend the same or more despite these factors is a sign of continued confidence in our economy, underpinned by a very stable jobs market in WA.”
The data also shows a generation gap when it comes to spending intentions over the festive season.
One in three (33%) young people aged 18-39 said they would spend more this Christmas than the previous year, compared with only 10% of over 65’s.
“This could be driven by a number of factors, including increased travel by younger people over the holiday period,” Mr Morey said.
The Consumer Confidence report shows almost half of Western Australians (49%) believe economic conditions will remain the same in the next three months.
More than one in five (21%) expect conditions to improve, up two percentage points from the September quarter. The remaining three in ten (30%) expect conditions to worsen.
WA households are the most optimistic in the nation when it comes to the economy, bucking the national trend that saw a 2.6% drop in consumer confidence in November, according to the Westpac-Melbourne Institute Consumer Sentiment Index.
But the longer-term outlook is less optimistic, with 34% anticipating conditions to remain unchanged, one in three (33%) expecting conditions to worsen and the same proportion (33%) expecting conditions to improve.
71% of respondents said the high cost of living dampened their confidence this quarter, while more than two in three (64%) said interest rates were weighing heavily.
Almost three in five (57%) said global economic news, including the potential impact of the conflict in the Middle East, impacted their confidence – an increase of four percentage points in the last three months.
