- Deutsche Bank
Australian consumer confidence dropped unexpectedly in March after reaching the highest level in four months in February as volatile financial markets dominated the news headlines. The Westpac-MI consumer sentiment index declined 2.2% to 99.1, with a reading below the 100 level indicating pessimists outnumber optimists. Three of the survey's five sub-indices deteriorated during the reported month with the sharpest decline registered in perceptions towards family finances compared to a year ago, which plunged 8.2%. However, expectations for the economic outlook over the next 12 months rose 8.2%, as last week's data showed the Australian economy outpaced economists' expectations by growing 3% in 2015. On a quarterly basis, the nation's economy grew 0.6% in the three months through December, driven by a solid 0.7% increase in private consumption, which contributed 0.4 percentage points to GDP growth.
A separate report showed home loans in Australia declined more than expected in January, suggesting that the property market may lose some steam even despite record low interest rates. Loans dropped 3.9% month-on-month in January, following the 2.7% gain in December. A robust property market boom in Australia has been supported in recent years by low interest rates and a flood of foreign money, particularly from China.
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