Consumer confidence only rose slightly during June despite talk of interest rate cuts, according to the latest figures from the Westpac-Melbourne Institute Index of Consumer Sentiment.
The bank said sentiment only increased by 0.3% in June from 95.3 points to 95.5.
“This is another disappointing result,” Westpac chief economist Bill Evans said in a statement. “Clearly other factors are dominating rates in the minds of consumers – those factors are concerns about the domestic economy and international conditions.”
Sentiment remains 1.7% below the October 2011 level despite interest rates having fallen 125 basis points.
“Clearly other factors are dominating rates in the minds of consumers – those factors are concerns about the domestic economy and international conditions,” said Evans.
“Evidence from today’s survey confirms the fragility of confidence and the critical role played by the global economic situation in impacting confidence,” he said.
The result comes after NAB released its monthly business index yesterday, indicating SME confidence is continuing to fall.
Westpac said the measure of consumers’ outlook for conditions over the next 12 months fell 0.2%, while the index for the next five years fell by 3.8%.
This article first appeared on SmartCompany.