ANZ says July consumer confidence stayed weak and inflation expectations nudged over 5%

Consumer confidence remained weak in July as inflation stayed "front of mind" for households.

The ANZ-Roy Morgan Consumer Confidence Index slipped 4 points to 94.7, "continuing its recent zig-zag pattern," ANZ economists said.

"Activity indicators have slipped in recent times and it’s entirely possible that both GDP and employment went backwards in the June quarter," said ANZ chief economist Sharon Zollner.

"Soft consumer confidence is both a reflection of and a contributor to the sluggish economy."

However, ANZ economists did expect improvement, pointing out more people were rolling off onto lower mortgage rates each month, and high farmer incomes were supporting the regions.

Inflation expectations lifted 0.2 percentage points to 5.1%, the highest since April 2023.

Perceptions regarding the economic outlook over the next 12 months fell three points to -16%. 

ANZ said that was driven by households' experience of higher-than-CPI rises for food, electricity, council rates and insurance.

The proportion of households thinking now is a good time to make a major purchase remained "very weak," falling one point to -8%.

Perceptions of current and personal financial situation also remained weak, dropping 8 points to -21%.