Australians Worried About Economy

Australian consumers are currently the most pessimistic in Asia, according to a global study by ACNielsen. 43% said they felt the economy would deteriorate in the coming year compared to just 28% across the region - and 34% felt the strength of the economy had deteriorated over the past six months.

The twice-yearly global consumer confidence survey questioned more than 20,000 people in 38 countries and covered topics including how respondents spend their spare case once all essential living expenses are covered; their thoughts on the country's economic performance over the past six months and over the next 12 months; their greatest concerns over the next six months; and their confidence in the local employment market.

Greece, France, Italy and Germany also have a large proportion of consumers who expect the economy to deteriorate in the near future. Overall, 34% of consumers thought their economy had deteriorated, up from only 13% in the last round in October 2004, while the number who thought the economy would deteriorate in the year ahead was up from just 23% to 43%.

'Australia's economy has experienced unprecedented growth and prosperity in recent years', says Paul Richmond, MD of ACNielsen Australia. 'However, consumer sentiment seems to have turned and Australians are expecting tough times ahead, perhaps as a result of recent market speculations and commentary around trends such as falling real estate prices, rising oil prices and uncertainty in the stock market, as well as possible interest rate rises'.

Australians have accumulated one of the highest levels of personal debt in the developed world, and are cautious about spending. After repayment of debts (43%) the second most common use of spare cash was savings, with 34% saying they put spare cash into savings accounts. However, most think they are doing enough - 67% said the state of their own personal finances in the next 12 months would be good or excellent.

Aside from the economy, rated by almost one in five Australian consumers (19%) as their biggest fear over the next six months, the most common concerns were health (18%) and job security (17%).

More generally, consumer confidence across the Asia Pacific region has also taken a knock since the last time the survey was undertaken - 33% said their economy had deteriorated in the past six months - but confidence moving forward was high, with the majority of respondents (38%) expecting that the economy would improve in the year ahead.

AC Nielsen Australia is online at www.acnielsen.com.au

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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