Australian Consumers Locked in Cost-of-Living Nightmare

By James Glynn

SYDNEY--Australian consumer confidence went into steep decline in October as households responded to the twin shocks of rising interest rates and ongoing cost of living strains.

The Westpac-Melbourne Institute consumer sentiment index fell 4.7% to 80.4 in October from 84.4 in September.

"Australian consumers remain stuck in a cost-of-living nightmare that seems to have no end in sight," said Westpac head of Australian Macro-Forecasting Matthew Hassan.

At just over 80, the latest sentiment index is amongst the 40 worst reads since the monthly survey began in the early 1970s, he added.

"This marks the worst period of recurring extremely weak sentiment since the disastrous recession in the early 1990s," Hassan said.

The weak survey data come as the Reserve Bank of Australia announced its fourth interest rate rise this year, with the door left open for a further hike in November. The unresolved war in the Middle East also continues to drive up fuel costs.

Average weekly gasoline prices have pushed back over 2.30 Australian dollars per liter nationally, to be near the peaks seen back in April and up nearly 25% since the start of the year.

"The survey detail shows consumer concerns are still primarily about the cost-of-living and high interest rates than the more acute job and insolvency problems that arise during a recession," Hassan said.

Pessimists outnumbered optimists in 102 of the 106 sub-groups tracked by the survey, the data showed.

Write to James Glynn at james.glynn@wsj.com

(END) Dow Jones Newswires

October 05, 2026 20:19 ET (00:19 GMT)