Tony Abbott’s departure boosts consumer confidence

Tony Abbott’s removal from the post of Australia’s prime minister has boosted consumer confidence to a new level, according to a recent confidence survey by ANZ-Roy Morgan. The recent political developments that overhauled the cabinet led consumer confidence to rise to 8.7 percent from the 7.1 percent two weeks back.

The results declared on Tuesday not only indicates a rise in consumer confidence from the two weeks low during the political uncertainty but has also put the headline index above the long-run average. The findings also emerged the same day News Corp published the Newspoll results that put the coalition five points up and brought down the Labor by four points to a 51-49 ratio.

"The sharp jump in consumer confidence last week is a clear vote of confidence in the new Prime Minister, Malcolm Turnbull," Sydney Morning Herald quoted ANZ chief economist Warren Hogan as saying. "A similar surge in business confidence was evident when the Coalition won government in late 2013."

Respondents are also showing positive attitude towards their prospects over the next five years, according to the survey, which sent the sub-index surging to 13 percent.

Hogan has also pointed out that the consumer confidence index also surged when the Abbott-led Coalition came to power in 2013.

"For the bounce to be sustained, however, the new prime minister and his colleagues will need to deliver a medium-term reform strategy in the context of a clear economic story for the country," he said. "We believe the new Prime Minister's first 100 days in office will be essential to formulating a new narrative for the economy that underpins confidence in the economic outlook. Expectations are clearly high, not unlike when the Coalition initially won power, and the community will be sensitive to disappointment on this front.”

He noted that a clear and comprehensive economic strategy is critical to sustain the consumer confidence over a longer period of time. Else there would always be a possibility of the gloom to re-emerge.

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