Rising costs continue to plague consumers’ purchasing intentions and sentiment, according to the latest figures from Nielsen.
It’s noted that rising utility bills were cited as the most or second-most pressing concern by 40 per cent of Australians – a figure that has been increasing throughout 2012. The second biggest concern was job security at 14 per cent, followed closely by the economy at 10 per cent.
“Consumers are preoccupied with factors such as deteriorating economic conditions overseas and the increasing cost of living. Continuing frustration over the banks not passing on interest rate cuts in full and ever-increasing utility costs is doing nothing to bolster sentiment,” Chris Percy, Nielsen Pacific managing director, said.
Supporting their concerns were the figures that showered almost two thirds of Australians have changed their spending habits in the last 12 months to save money on living expenses. The most popular way they are doing this is reducing takeaway meals, closely followed by measures to save on gas and electricity. Spending on clothes has also dropped.
Consumers also indicated they are opting to buy cheaper grocery brands and cutting down their spending on out-of-home entertainment to save money.
“Australians are being hit hard by the increasing cost of living, and a lack of confidence in the marketplace will only serve to further impact discretionary spending as people opt to keep their wallets firmly in their pockets,” Percy said.
Meanwhile, the study found a portion of the spare cash were being put towards savings and paying off debts including credit cards. However, nearly one in five Australians now claims they have no spare cash after living expenses are paid.
Compared with other countries around the world, Australia ranked 25 out of the 56 nations surveyed in terms of consumer confidence – just behind New Zealand, Israel and Pakistan.
“Poignantly, this is the first time Australia has dropped below New Zealand in terms of consumer confidence in the past year. While New Zealand consumer sentiment has remained relatively stagnant in recent times, Australia has experienced a number of fluctuations including a significant drop in confidence in 2012,” Percy said.
Despite this, Asia-Pacific nations come out on top overall making up seven of the 10 most optimistic countries. Indonesia, India and the Philippines recorded the highest levels of consumer confidence globally.
The European nations of Hungary, Portugal, Italy and Greece took out the bottom four spots.
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