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Australian consumer confidence stumbled unexpectedly in April after strong gains in the past two months, a survey released on Wednesday by the Westpac Banking Corp and Melbourne Institute found.
The Westpac/Melbourne Institute index of consumer sentiment fell by 5.1 percent in April to 104.9 points, from 110.5 in March. A reading above 100 indicates optimists outnumber pessimists among respondents.
Westpac chief economist Bill Evans said a 5.1 percent fall in consumer sentiment in April was not expected. "This result emphasizes how fragile consumer confidence has become in the current environment," he said in a statemento on Wednesday.
"In fact, the index is now only 1.5 percent above its level in November 2011, following the Reserve Bank's first cut in this easing cycle and only 0.6 percent above the print from last November."
Evans said the combination of global financial concerns and an associated correction in the share market, as well as concerns about a possible rise in interest rates, have dampened confidence.
"The disturbing news of around Cyprus with associated risks around European stability may have unnerved respondents," he said.
"There was also some media coverage locally around prospects of rising interest rates perhaps as soon as year end. The decision by the Reserve Bank to hold rates steady at its April meeting was widely expected but would not have allayed any concerns about rising interest rates." The survey of 1200 adults aged 18 years and over was conducted between April 2 and 7 across Australia.