Australian consumer sentiment fell to the lowest level since August 2011 in December with the Westpac-MI index sliding 5.7% to 91.1. Over the past 6 months the index has fallen 4% while that compared to a year ago is off 13.3%. Reflective of the overall trend, the index has fallen in annualised terms since February this year.
Reflecting the weak Q3 GDP figure released last week expected economic conditions over the next 12 months fell by 9.7% with those out 5 years declining by a smaller 1.8%. Perhaps as a consequence of higher house prices the measure on family finances compared to a year ago rose 1.6%, the only component in the survey to increase, although expectations for the year ahead slid 4.0%. In what must be concerning outcome for retailers heading into Christmas the survey’s measure on whether it was a good time to buy a major household item plunged by an alarming 11.8%. On housing, the measure on whether it was a good time to buy a dwelling dropped 10.8%, something that will interest the RBA given their continued focus on developments in the Sydney and Melbourne property markets.