Analysts at TD Securities note that Australia’s Westpac Consumer Confidence index plunged to 92.8 in October from 98.2 in September.
“This is the lowest level since July 2015 and the fall comes despite a 25bp cash rate cut from the RBA last week – the third rate cut since June. This is a disappointing outcome as the 5.5% m/m fall follows the downbeat 1.7% m/m fall in September.”
“Consumers have clearly looked past the rate cuts and are arguably nervous about the global risks driving rates lower. All index components fell in October. The sub-index recording Consumer expectations for the economy for the next 5 years’ plunged 9.1% while the ‘economy, next 12 months’ sub-index dropped by 6%. October marks the first month where both sub-indexes are below their long run average levels since April 2016.”