Consumer confidence is on the up
Consumer confidence has a massive impact on various parts of the economy. Not only does it give people a more positive outlook on life, but also encourages them to make bigger purchases they might otherwise have been putting off – like a new car loan.
Results of the latest ANZ-Roy Morgan Consumer Confidence index for the week ending April 28 show that sentiment is definitely on the rise. Over the course of the week, confidence marked a 2.8 per cent rise, reversing some of the losses seen lately.
There was an 8.6 per cent increase in the number of people saying they are optimistic about what the next 12 months have in store. However, there was a 2.7 per cent fall in the household finances over the year ahead sub-index.
So what does this mean for spending? While people might be keen to start making big purchases, they might not quite have the confidence they need to make it happen.
Financial products such as car loans may therefore increase in popularity as consumers want to make the most of improved conditions in the wider economy.
Roy Morgan Research revealed that car buying intentions were on the rise in February, showing that people aren't being deterred by some of the minor issues that still face the economy. Over the next four years, 2.37 million people said they plan on buying a new car, which was up 129,000 from the previous month.
Many people won't be holding off with their purchase either, as 598,000 motorists revealed intentions to buy a new car in the next year. This is slightly higher than the previous month, as well as this time last year.
Jordan Pakes, industry director for automotive at Roy Morgan Research, suggested that some car brands are likely to be more appealing than others.
"Since the beginning of the year, new car intention has increased for most automotive brands, with local makes Ford and Holden gaining 36,000 and 25,000 additional intenders respectively," Mr Pakes added.