Australia consumer sentiment stuck in the doldrums amid rate jitters

SYDNEY, Jan 13 (Reuters) - Australia's ⁠consumer sentiment ⁠slipped ‍in January as households wrestled with renewed rate jitters and an uncertain economic outlook, a private survey ‍showed on Tuesday.

A Westpac-Melbourne Institute survey showed its ​main index of consumer sentiment fell 1.7% to 92.9 in January, after ​tumbling 9% the month before. The reading remained below 100, suggesting pessimists outnumbered optimists.

"While confidence is still well above the extreme lows recorded during ​the protracted 'cost of living' crisis in 2022–2024, consumers are becoming more concerned about what 2026 may bring for ​family finances and the wider economy," said Westpac's head of Australian macro-forecasting, Matthew Hassan.

"The ‌main catalyst continues to be a sharp turn in interest rate expectations."

The Reserve Bank of Australia, ​which cut interest rates three times ⁠last year to 3.6%, has signalled the current easing cycle could already be over as inflation ‌surged.

Two of the big four Australian banks - the Commonwealth Bank of Australia and the National Australia Bank - have tipped a rate ‌hike next month.

KEY DETAILS

• The breakdown of the survey showed the outlook ‌for family finances over the next year fell 4.5% to 97.8. The measure of the economic outlook for the next 12 months dropped ‍6.5% to 88.4.

• Nearly two-thirds of consumers expect mortgage rates to move higher over the next ⁠12 months, more than double that in September.

• The measure of whether it was a good time to buy a major household item rose a small 0.2% to 99.1.

(Reporting by Stella Qiu; Editing by Himani Sarkar)

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