MNI 5 Things:Australia Sentiment Tad Up But Spend Outlook Weak

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By Sophia Rodrigues

     SYDNEY (MNI) - The following are the five key observations we made from the

Westpac-Melbourne Institute's consumer sentiment survey for March, published

Wednesday.

     --Sentiment rose slightly in March, up 0.2% m/m to 103.0 to mark fourth

straight month of reading above 100.0 level. However, it remains well below

levels typically associated with a robust consumer.

     --Despite reading above 100.0, the details in the survey and additional

questions suggest a cautious consumer and points to subdued outlook for

household consumption. The sub-index "finances vs year ago" rose 2.4% m/m but

remains low at 86.6. The index of house price expectations fell and was notably

weaker in New South Wales. The "time to buy a dwelling" index rose slightly but

remains well below its long-run average, although a bright spot was improvement

in sentiment in Sydney and Melbourne.

     --The "time to buy a major item" sub-index remains consistently below its

long-run average and points to a continued reluctance to commit to large

purchases.

     --Households are showing increased concerns about the economy likely due to

developments abroad. The highest recall rate was of news on economic conditions

which was negative versus three months ago. And the most notable shift was on

international conditions which was viewed a significantly more negative than

three months earlier.

     --The sub-index "economic outlook, next 5 years" fell 4.1% m/m in March

which may be a reflection of news around global trade tensions following

announcement of tariffs on steel and aluminium in the U.S.

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

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