Australia Westpac Consumer Sentiment Index dropped -6.1% to 87.9 in July, down from June’s 93.7. The decline reversed all of June’s impressive gain and took the index back to the weak levels seen in May. Nevertheless, it’s still 16% above April’s extreme low of 75. Westpac said “sentiment has been rocked by the resurgence in Coronavirus cases over the last month.” The survey cover the week Melbourne returned to lockdown. And it’s of “some concern” that it pre-dates the news of a significant cluster of coronavirus cases in Sydney.
Westpac expects RBA to “maintain its current highly stimulatory stance and continue to commit to steady policy for the foreseeable future” at the upcoming meeting on August 4. More immediately, the government would likely release revised economic forecasts on July 23 fiscal update, with further fiscal stimulus.