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Consumer sentiment bleak
The pessimistic outlook of many Australians on the economy is affecting financial decisions, a survey by CUA has found.
The CUA National Mortgage Survey found that 48 per cent of respondents believed the economy will worsen by the end of the year, and only 10 per cent believed it will improve.
This sentiment is affecting spending, with 75 per cent of respondents saying the high cost of living would make them think twice about financial decisions, while 58 per cent said the falling Australian dollar and the predicted end of the resources boom also caused enough concern to impact financial decisions.
The survey also found that despite experts predicting that the interest rate will fall or remain steady by the end of the year, 37 per cent of Australians expect the official cash rate to rise.
CUA general manager Jason Murray said this uncertainty may trigger a trend towards mortgage fixing.
“CUA’s survey certainly reflects this, showing that almost four in tenAustralians who currently have a variable rate mortgage are planning to fix their mortgage rate in the future,” he said.
“This has increased by seven per cent from January, when three in ten had this intention.
“Young Australians under 30 are more likely to seek certainty in their repayments, with more than half (56 per cent) planning to fix their mortgage in the future,” Mr Murray said.
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