Higher living costs, Omicron, global fears grip WA households

CCIWA Chief Economist

Aaron Morey

WA households confidence has dropped from record highs, according to CCIWA’s latest Consumer Confidence Survey.

 

This quarter, Western Australians absorbed news of rampaging global inflation, the prospect of interest rate hikes, the invasion of Ukraine, and the arrival of Omicron in WA. These factors shook their confidence, delivering a 12.3 percentage point fall in the short-term outlook. For the first time since September 2020, more Western Australians expect economic conditions to weaken (32%), than to improve (24%).  

 

Amid supply chain disruptions and higher fuel prices, cost of living has emerged as the biggest issue impacting confidence. It weighed on the outlook of nearly two thirds of Western Australians (65%). 

 

Concern about the presence of COVID in WA is nearly as acute (63%), with Western Australians indicating they are set to scale back their attendance at concerts, sport and festivals (63%), bars and restaurants (58%) and shopping centres (50%). 

 

Western Australians are also bracing for an increase in mortgage rates, with one in four respondents (25%) indicating they could not absorb the additional cost. 

 

As shown by CCIWA’s Outlook, these factors are expected to dent, but not derail WA’s economic trajectory. WA remains a hot jobs market, with personal employment stabilising the confidence of one in three households (34%), along with confidence in the State Government (43%).

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