Australian consumer sentiment remains deeply subdued, with the latest ANZ-Roy Morgan Consumer Confidence index edging down 0.3 points to 66.1 for the week ending 24 May — a reading that keeps the measure close to its lowest levels since the series began more than five decades ago.
The four-week moving average eased marginally to 66 points, underscoring the persistence of the confidence slump rather than a one-off dip. The current reading sits roughly 40% below the long-run monthly average of 108.8 since 1990.
Beneath the headline number, the weekly data revealed a divergence in how Australians are feeling about their immediate finances versus the broader economy.
Views on current financial conditions fell 3.5 points, and expectations for future financial conditions over the next 12 months declined 2.1 points — a signal that household budget stress remains acute. At the same time, short-term economic confidence edged down 0.8 points while medium-term economic confidence — covering the next five years — rose 1.2 points.
ANZ economist Sophia Angala (pictured) attributed the modest improvement in economic sentiment to global developments, noting it "may have been driven by news of the prospect of a US-Iran deal."
One brighter spot for the week was the “time to buy a major household item” subindex, which lifted 4 points — a reading that brokers may view as a tentative indicator of improving appetite for large financial commitments.
Inflation expectations ticked up 0.1 percentage points to 6.0% for the week, though the four-week moving average eased slightly to 6.3%. The move follows a sharp acceleration in official price data. The ABS reported that annual CPI rose 4.6% in the 12 months to March 2026, up from 3.7% the previous month. Housing costs rose 6.5%, and transport was up 8.9% annually — the largest contributors to the acceleration.
Angala said the weekly inflation reading would be key to understanding how cost pressures are flowing through the economy.
"Weekly inflation expectations ticked up ahead of April CPI data this week, which will be key to revealing the speed and extent of which higher input costs (such as fuel, fertiliser, or plastics) are flowing through to the broader inflation basket," she said.
ANZ's own forecast is for headline inflation to have risen 0.5% month-on-month in April, with the ABS result due 27 May — a reading that, if confirmed, will have direct bearing on the RBA's next rate deliberations and the outlook for borrowers.
With confidence hovering near historic lows and household financial conditions under pressure, brokers are likely to encounter clients who are cautious about taking on new debt or refinancing. The modest lift in medium-term economic confidence and the “time to buy” subindex may offer some grounds for optimism, but the prevailing mood among Australian households remains one of restraint.
The backdrop helps explain it. The RBA raised the cash rate by 25 basis points to 4.35% at its May meeting — the third consecutive hike in 2026, following increases in February and March — with Canstar estimating monthly repayments on a $600,000 loan to have risen by around $272 a month across the three increases combined, effectively wiping out the three rate cuts delivered in 2025. $600,000 loan
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