Consumer confidence fell by 6.1% to 87.9 in July 2020, reversing the improvement reported in June. The index has not been above 100 for thirteen months. Importantly, the survey was taken after the recent increase in restrictions in Victoria but before the most recent increase in cases in New South Wales. The confidence index fell 10.4% in Victoria giving some insight into what a broader outbreak and restrictions might do to national confidence. The most recent retail sales data released last week was for May and showed a 16.9% increase compared to the 17.7% fall in April. Sales in clothing, footwear and personal accessories recorded a 129% increase during the month and most other categories recorded double digit growth from the poor results in April. When considering what the July confidence data might mean for sales, the past few months gives us some insight into the “jumpy” nature of the consumer. The recent low point in confidence in April (75.6) saw retail sales fall 17.7%, whereas the 16.5% increase in confidence recorded in May coincided with a 16.9% increase in sales. The most recent online retail sales data shows a 1% reduction in May 2020 following the all-time high level of growth experienced in April. The May results represents the first month without growth in the past seven months.
Source: Westpac – Melbourne Institute Consumer Sentiment Index
Source: Australian Bureau of Statistics
Online retail sales