Consumer sentiment experienced a decline of 4.5% to 107 in January 2021 following the most recent COVID-19 outbreak in New South Wales and resultant domestic border closures. The decline in consumer sentiment comes after four months of consistent (almost extraordinary) growth in confidence. The index still remains in positive territory and is 14.6% higher than January 2020 and 41.5% higher than the April low of 75.6. All subcomponents fell, with the biggest drop of 8.3% in the ’economic outlook for the next 12 months’ category. The most recent ABS retail sales data for November 2020 recorded a significant increase of 7.1% for the period, capturing both the ‘Black Friday’ and ‘Cyber Monday’ sales events. Consumer sentiment rose by 2.5% during that same period amid a run of sustained growth which supports the sales increase. A number of the subcategories experienced strong growth in November, with increases in clothing, footwear and personal accessory retailing (26.7%), department stores (21.1%) and household goods retailing (12.7%). Victoria continued to record strong growth in retail sales (22.4%), whilst more moderate growth was recorded in Queensland (4.5%), New South Wales (2.3%), Western Australia (1.2%), Tasmania (3.4%), the Australian Capital Territory (2.5%) and the Northern Territory (2.2%). South Australia experienced a minor decrease in sales of 0.2% following its brief lockdown. Interestingly, the retail sales total of $31.7b in November 2020 was 13.3% higher than November 2019. Online sales accounted for 11% of total retail turnover in November 2020 compared to 10.4% the previous month and 7.2% in November 2019.
Source: Westpac – Melbourne Institute Consumer Sentiment Index