By Rudi Filapek-Vandyck<\/p>\n
Westpac economists report unemployment expectations among Australian consumers improved in May for the third consecutive month. Westpac’s unemployment expectations index improved in May, declining by 1.0%. The index has now declined by 5.2% from its February peak, report the economists.<\/p>\n
Unemployment expectations among consumers in Australia rose sharply from September 2008, jumping 33% over 5 months. This coincided with the global melt down. Similarly, recent evidence of a stabilisation in the world economy has triggered an improvement in domestic sentiment, the economists believe. They add this is apparent not only from consumers’ unemployment expectations but also a lift in business confidence from record lows.<\/p>\n
Even with the 5.2% improvement in the index, Australian consumers are expecting the unemployment rate to rise substantially<\/p>\n
Inflation expectations, on the other hand, declined in May, reinforcing the downward trend, Westpac economists report. According to the May survey, consumers’ median inflation expectation declined to 2.3% from 2.4%.<\/p>\n
In trend terms, median expectation consolidated at 2.2%, unchanged from April. Westpac economists point out, the May read is a sharp improvement from 5.2% a year ago and is the lowest level since 1998. The last time expectations were sub 2% was in 1994.<\/p>\n
The median expectation of managers and professionals dropped to 1.6%, down from 1.8% previously. The economists highlight this has taken the trend for this segment to a new record low of 1.65%. (data commenced 1995).<\/p>\n
By contrast, the trend net balance expecting higher prices rose to 51.3% from 46.8%. The economists state they are inclined to view this as “noise in the data”.<\/p>\n
The proportion of respondents expecting inflation within the 2% to 3% target band held steady at 10.6%, an improvement from the 12 month average of 8.8%.<\/p>\n
The downtrend in expectations has occured against the backdrop of moderating headline inflation, the economists point out. They add the ABS estimates that annual inflation slowed to 2.5% in the March quarter, whereas a year earlier it was running at 4.2% and heading to 5%.<\/p>\n","protected":false},"excerpt":{"rendered":"
The May survey by Westpac has in essence revealed no major changes from April about consumers’ views on unemployment or inflation.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[6],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/55458"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=55458"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/55458\/revisions"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=55458"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=55458"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=55458"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}