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March 24, 2026 \u2014 10:06am<\/p>\n
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Remove items from your saved list<\/a> to add more.<\/p>\n Save this article for later<\/p>\n Add articles to your saved list and come back to them anytime.<\/p>\n Got it<\/p>\n AAA<\/p>\n The combination of spiralling petrol prices, the war in Iran and the Reserve Bank\u2019s latest interest rate rise has crashed consumer confidence to its lowest level on record.<\/p>\n In what points to a sharp contraction in household spending that could hurt the entire economy, the ANZ-Roy Morgan weekly measure of consumer sentiment dropped 5.4 points over the past seven days.<\/p>\n The measure, released on Tuesday morning, has now fallen 20 per cent since the war against Iran began. It is at its lowest level since the measure was created in 1973 during the first oil shock.<\/p>\n Expectations about inflation have soared to reach 6.9 per cent, higher than it hit during the post-pandemic inflation surge.<\/p>\n ANZ economist Sophia Angala said the sharp fall in confidence was largely due to the lift in oil prices and the Reserve Bank\u2019s decision last week to push official interest rates up to 4.1 per cent.<\/p>\n \u201cWith very large increases in petrol prices through March, inflation expectations rose to an all-time high last week,\u201d she said.<\/p>\n<\/p>\n \u201cHousehold confidence in their current and future finances weakened sharply, as did the \u2018time to buy a major household item\u2019 subindex, which is at its lowest since late March 2020 when pandemic lockdowns were announced.\u201d<\/p>\n Consumers are not only worried about inflation and the immediate hit to the economy. Expectations around the economy over the next 12 months fell another 3.9 points, while the measure of whether it is a good time to buy a major household item plummeted 9.5 points.<\/p>\n The index was released after the Council of Financial Regulators, which is made up of the Reserve Bank, federal Treasury, the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission, expressed concern about the war\u2019s impact on the nation\u2019s financial system.<\/p>\n \u201cThe council noted that while direct exposures of the Australian financial system to the Middle East were limited, a further deterioration of the geopolitical environment could heighten risks to financial stability and requires continuing vigilance,\u201d it said in minutes of its Monday meeting.<\/p>\n Related Article \u201cCouncil members observed that the Australian financial system has established a good degree of resilience and is well-placed to navigate a high-risk international environment.<\/p>\n \u201cIt is important, however, that banks maintain strong levels of capital and liquidity, in the context of wider council-industry efforts to strengthen crisis preparedness arrangements.\u201d<\/p>\n There are concerns that the RBA\u2019s most recent rate rise will weigh heavily on some borrowers.<\/p>\n The council warned the nation\u2019s commercial banks that they needed to maintain high lending standards.<\/p>\n \u201cThe council also noted that most borrowers in Australia are in a solid financial position and remain able to manage increases in cost pressures, though some will face growing challenges,\u201d it said.<\/p>\n \u201cThe council agreed it would be important for lending standards to remain prudent, given the backdrop of high household indebtedness, recent strong credit growth and reports of strong competition among lenders.\u201d<\/p>\n Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter<\/a>.<\/p>\n Save<\/p>\n You have reached your maximum number of saved items.<\/p>\n Remove items from your saved list<\/a> to add more.<\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/03\/d869cc1c02c34b051cc8be2c2f96b01057f82175.jpeg\")
A collapse in consumer confidence could mean a drop in shopper activity across the nation\u2019s retail outlets.Eamon Gallagher<\/p>\n![\"Wright](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/03\/1774092617_493_ca51deeda31f5b53d74658bcde26bd261a02e213583e8a2ee7169f0187d6514d.jpeg\")
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Shane Wright<\/a> is a senior economics correspondent for The Age and The Sydney Morning Herald.Connect via X<\/a> or email<\/a>.From our partners<\/p>\n","protected":false},"excerpt":{"rendered":"March 24, 2026 \u2014 10:06am Save You have reached your maximum number of saved items. Remove items from…\n","protected":false},"author":2,"featured_media":560403,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-560402","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/560402","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=560402"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/560402\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/560403"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=560402"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=560402"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=560402"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}