Australian mortgage holders’ confidence hits record low as economic gloom deepens

Confidence among Australian households with mortgages has fallen to its lowest level since records began in 1994, reflecting deep pessimism about the economy and a sense that rising costs are beyond their control. The results add pressure on the Labor government to address cost-of-living concerns and curb spending, while the prime minister has publicly backed Treasurer Jim Chalmers ahead of a budget update.

Westpac’s November survey found overall consumer sentiment at a four-year low, with expectations for the economy over the next year at their weakest since August 2020. Nearly three in four respondents expected another rate rise within 12 months, following five increases this year, although financial markets priced in a greater than 50% chance of a rate cut by August 2027. Westpac’s forecast is for cuts to begin in August next year, as Brent crude prices have fallen about 20% from their late-October peak.