The survey pre-dates recent rapid shifts in US government policies. Clearly this will add further to the concerns of an already stressed consumer. That said, there were some clear green shoots this quarter. The ‘vibe’ was shifting. The first rate cut in four years lifted sentiment among some consumers, although further cuts will clearly be needed. On balance fewer consumers also expected inflation, taxes and unemployment to rise in the next 12 months, with the number who viewed the likelihood of recession also falling. There was also a sharp turnaround in expectations for interest rates with many more Australians expecting them to fall. Fewer consumers however saw their wages rising and the share market increasing.

Sentiment is already fragile with 1 in 2 consumers perceiving more bad news than good over recent months, with cost of living and geopolitics dominating media. Consumers are facing extraordinary levels of uncertainty. They should be supported by lower interest rates, but any meaningful rise in concerns over job security is a key risk.