Latest ANZ-Roy Morgan data shows only a modest lift as economists warn further rate rises ahead
Australian consumer confidence rose a handful of points last week, but remained well below the neutral 100 level that separates optimism from pessimism, according to the latest ANZ-Roy Morgan Australian Consumer Confidence report.
The two-point uptick to 73.9 followed a fall the previous week and left the measure roughly in line with where it has sat for most of 2026. With an average reading of 108.5 over the past 26 years, it is clear that the Australian public remains in a deep trough.
Consumers remain highly sceptical of a recovery in their day-to-day living costs, with combined survey respondents expecting inflation to hit 6.1% (on a four-week moving average).
To put that into context, the highest rate of inflation on a combined annualised average over the past decade was 6.62% in 2022. It is currently sitting at 3.5%. While it came in ahead of forecasts in July, none of the major banks expects it to increase by any meaningful amount going forward.
Source: ANZ-Roy Morgan Australian Consumer Confidence report
Sub-index moves were mixed: confidence in current financial conditions jumped six points and future financial conditions gained 2.4 points, while short-term economic confidence rose 0.9 points and the "time to buy a major household item" measure added 0.4 points.
ANZ economist Sophia Angala said the survey's gains were driven mainly by improved sentiment around personal finances, even as broader confidence remained "well below the neutral 100 level" which she linked to inflationary pressure, global uncertainty and higher interest rates from the Reserve Bank of Australia (RBA).
Angala also noted RBA deputy governor Christopher Hauser’s comments last week that the central bank remains alert to upside inflation risks and is prepared to raise the cash rate further if required.
The warning has weighed most heavily on mortgage holders, even as confidence rose among outright homeowners and renters.
ANZ now expects the RBA to lift the cash rate by 25 basis points in November, having switched from a ‘hold position’ in August. Each of the other big four banks – Commonwealth Bank, Westpac and NAB – similarly expects a 25-basis-point hike by the time Christmas arrives.
Rate outlook keeps borrowers on edge
Soft consumer confidence sits against a backdrop of rising mortgage stress.
Roy Morgan data shows 30.3% of owner-occupied mortgage holders – around 1.6 million people – were classified as "at risk" in the three months to June 2026, with modelling suggesting further rate rises could push that figure past 31%.
Separately, the Real Estate Institute of Australia REIA) found the proportion of median family income required to service the average home loan has risen to 50.8%, a level its president, Jacob Caine, said reflected the "significant pressure" higher rates are placing on household budgets.
