Australia Consumer Sentiment Falls Sharply

2025-12-16 00:21 By Farida Husna 1 min. read

Australia’s Westpac–Melbourne Institute Consumer Sentiment Index plunged 9.0% mom to 94.5 in December 2025, slipping back below the 100 mark after briefly returning to optimism in November for the first time since February 2022.

The decline followed a 12.8% surge in the prior month, due to growing worries about inflation.

Economic sentiment weakened, as the one-year outlook slid 9.7% to 94.6 and the five-year view fell 11.7% to 95.7.

Household finances were also a drag, with views on conditions compared with a year ago dropping 5.0% to 80.9, while expectations for the next 12 months eased 6.1% to 102.4.

The “time to buy a major household item” index declined 11.4% to 98.9.

Still, views on unemployment improved, down 9.1% to 126.8.

Westpac’s Mathew Hassan said renewed anxiety over the interest-rate path was feeding broader concerns about the economic outlook.

He cautioned that if inflation takes longer to normalise, the cash rate could stay on hold for longer than currently expected.



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