Investing.com– Australian consumer sentiment worsened in early-September, a private survey showed on Tuesday, as consumers grew more concerned over a potentially harder landing for the Australian economy.
The Westpac-Melbourne Institute consumer sentiment index fell 0.5% in September after a 2.8% increase in the prior month. The index remained close to historical lows amid a nearly two-year slump in sentiment.
While concerns over inflation and high interest rates grew slightly less pronounced in September, consumers were seen fretting over a weaker outlook for the economy. Fears of a slowing job market also weighed.
Recent gross domestic product data showed Australian economic growth remained languid in the June quarter, while inflation was relatively sticky.
The Reserve Bank of Australia had also warned in recent weeks that sticky inflation could still see the bank raise interest rates higher- a scenario that was a key point of concern for consumers.
Fears of a slowing job were a major weight on sentiment, especially as recent data showed the Australian economy was cooling. A strong labor market has so far helped keep household spending elevated and sentiment relatively stable.
But any further deterioration in the economy could unsettle the labor market and spur increased unemployment- a scenario that bodes poorly for sentiment.
