ANZ-Roy Morgan Consumer Confidence in Australia rose by 2.5 points to 88.5 this week following the Australia Day long weekend, marking its highest level since May 2022, according to ANZ economist Sophia Angala.

Consumer confidence is now 4.7 points higher than the same week last year and 1.5 points above the 2025 weekly average of 87.0.

“Households are feeling more confident about the economic outlook, with short-term economic confidence rising to its highest level since April 2022 – before the first rate hike in May 2022 – while economic confidence over the next five years reached a 12-month high,” Angala said.

“The decline in weekly inflation expectations and the broad-based lift across the subindices may have been influenced by discussion that the Reserve Bank of Australia (RBA) could cut rates at its February meeting.

This comes after the quarterly CPI indicator showed that the RBA’s preferred measure of inflation, the trimmed mean, printed below RBA forecasts in Q4.”

Consumer confidence data by state reveals gains in Victoria, Queensland, Western Australia, and South Australia, while New South Wales saw little change.

The weekly increase in consumer confidence was driven by a rebound in buying intentions and a more optimistic outlook on the Australian economy over the next year and five years.

Currently, only 20% of Australians feel their families are ‘better off’ financially compared to the same time last year, while 46% say their families are ‘worse off.’

In addition, opinions on personal finances for the next year remained largely unchanged this week, with 33% expecting their family to be ‘better off’ financially by this time next year, while 28% anticipate being ‘worse off.’

Meanwhile, 11% of Australians expect ‘good times’ for the Australian economy in the next 12 months, the highest level for this indicator since July 2024. In contrast, 27% anticipate ‘bad times,’ marking the best ‘net result’ for this measure in nearly three years, since April 2022.

Net sentiment about the Australian economy in the longer term also improved this week, with 13% expecting ‘good times’ over the next five years, compared to 17% expecting ‘bad times.’

There was also an increase in net buying intentions this week, with 27% of Australians stating that now is a ‘good time to buy’ major household items, compared to 44% who believe it is a ‘bad time to buy’ such items.