Consumer sentiment rebounded in October, up a significant 8.4% to 94.8 over the month.
This recovery came on the back of soaring iron ore prices during the survey period (early October) – up 24% from its record low in July. Moreover, iron ore shipments in Port Hedland reported the largest volume for the year – a record 39.3 million tonnes in September.
Price expectations for household items were the most positive, up 20.9% over the month, closely followed by a 16.3% increase in sentiment regarding family financial conditions compared to a year ago.
Consumers were also optimistic about economic and family financial conditions in the next twelve months – up (a significant) 15.3% and 1.6% respectively.
The latest CPI figures for the September Quarter indicate a 0.1 percentage point drop in the annual inflation rate for Perth, to 1.1% over the year, which should ensure positive sentiment over household costs.
Nevertheless, downside risks persist from iron ore prices and weak labour market conditions.
Iron ore prices fell to a three month record low over the last week of October (close to the $50 a metric ton mark) following a rate cut and expansionary policy measures in China further weakening its current bearish outlook.
(Source: REIV / REIWA)
