Consumer confidence has fallen to a new low, down 10.9% from its post-election peak, according to the latest Westpac–Melbourne Institute Index of Consumer Sentiment.
The March reading came in at 99.5, where a score of less than 100 indicates more pessimists than optimists, with the latest survey down significantly from the post-election peak of 110.3.
“The initial declines in December-January looked to be mainly the unwinding of the election-related sentiment boost,” Westpac senior economist Matthew Hassan says.
“More recent falls though have had a very clear theme centring on a sharp loss of confidence in the economic outlook and escalating job-loss fears.”
NAB warns bailouts are not a long-term answer
National Australia Bank chief executive Cameron Clyne has warned that government money spent bailing out declining industries could be better invested in new sectors, in a speech to the Australia-Israel Chamber of Commerce lunch in Melbourne.
“The economy is in transition. What we are going through now is not unusual… [But] there are over 1 million people employed in industries that did not exist 20 years ago,” Clyne says.
“If you have $30 million, $50 million or $100 million I’d be saying wouldn’t it be far better invested into expanding opportunities for people to grow jobs of the future. That is how you help an economy in transition and that is how you pay a dividend in the future, [rather] than necessarily propping up an industry that in 12 months may be back looking for [another] handout.”
Auto parts manufacturers call for ongoing government assistance
Federation of Automotive Products Manufacturers president Jim Griffin has called for a continuation of the federal government’s Automotive Transformation Scheme amid growing pessimism about the long-term future of the sector.
Griffin says the extra time is needed to help manufacturers find new markets and diversify their operations.
“What we’re looking for is a continuance of the assistance programs that are already in place to support the carmakers and the component makers through to 2020,” Griffin says.
“We know that Ford is leaving in 2016, Toyota and General Motors in 2017, but what we want to see is a continuation of those programs to assist the components industry to survive beyond that point.”
The Dow Jones Industrial Average is down to 16340.1. The Aussie dollar is up to US89.86 cents.
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