Consumer confidence still low: CCI

Consumer confidence among Western Australian shoppers has only marginally improved in the last quarter, a Curtin Business School Chamber of Commerce and Industry WA survey of consumer confidence says.

The survey found that WA consumers are reacting negatively to the outlook of the local economy by spending less.

“Only 13 per cent of consumers expect the economy to improve in the next three months, up from 11 per cent last quarter, while just 30 per cent of respondents expect better conditions over the next year,” CCI said in a statement.

Higher living costs and an uncertain political environment have been highlighted as major contributors to the fall in confidence.

The report also found consumers were becoming more concerned about the local labour market, with only 19 per cent of respondents under the impression that their job prospects have improved.

It fell from 29 per cent in June.

“Consumer confidence has remained persistently low throughout the course of 2014, weighed down by concerns about how the economy will fare as we transition away from resources investment, and the ongoing political uncertainty at both a federal and state level,” CCI chief economist John Nicolaou said.

“The key issue for the local economy in the coming months will be the extent to which these concerns start to flow through into reduced spending activity.”

The property market delivered mixed emotions for the respondents, with 28 per cent saying they felt it was a good time to purchase real estate, while a similar proportion remained under the impression that market conditions were bleak.

“House prices have stabilised recently, which is likely to be the reason behind perceptions that housing affordability has improved,” Mr Nicolaou said.

“With investment in the resources sector now winding back off its record highs, a growth in new housing will be an important way to broaden the profile of WA’s economic growth and ensure a smooth tranisition back to more normal levels of activity.”