Australian Consumer Confidence Hits Recession-Era Low After Rate Hike

Consumer confidence in Australia has hit a new low, matching levels last seen during the 1990s recession. The Westpac-Melbourne Institute consumer sentiment index dropped 4.7% in October to 80.4 points, marking its lowest point since April. The decline deepened after the Reserve Bank of Australia (RBA) raised interest rates to a 15-year high of 4.6% last week. Among the 40% of respondents surveyed post-rate hike, confidence plummeted a staggering 20% to 67.2 points, the worst reading of the century.

The sharp fall underscores growing public dissatisfaction with the Albanese government’s economic policies. The data suggests widespread anxiety over the financial impact of rising interest rates, with many Australians bracing for prolonged periods of sluggish economic growth. The RBA’s latest move has intensified concerns about the country’s economic outlook, as households struggle with higher living costs.

Analysts warn that the drop in consumer sentiment could further dampen spending, exacerbating the economic slowdown. The government faces mounting pressure to address these concerns, as the data highlights the need for measures to restore public confidence in the economy.