Consumer confidence is tanking on the back of leaks about tonight's Federal Budget.
Even before Treasurer Joe Hockey releases the details of his first fiscal blueprint later today, the ANZ-Roy Morgan measure of consumer confidence has fallen to its lowest level since the depths of the Global Financial Crisis.
Over the past week, confidence slipped another 2.4 per cent.
It was the third successive fall in sentiment, tracking the first major leaks about the Budget and its impact on ordinary taxpayers.
ANZ chief economist Ivan Colhoun said confidence had fallen sharply in direct response to what shoppers were hearing awaited them this evening.
“Although the Government appears to be preparing the community for a ‘horror’ budget, ANZ’s view is that the budget will be tough rather than horrific and that fiscal policy is likely to be tightened progressively over the next few years,” he said.
“Regardless of what transpires tonight, this weekly index will be an important first gauge of the Budget’s impact on consumers.
“Developments in this series should be watched to garner how transitory the recent dip in consumer confidence will be,” Mr Colhoun said there was a real prospect the Budget could weigh on consumer spending for some time ahead.
A key part of the confidence measure, the perceptions of households’ financial situation compared to a year ago, fell 5.7 per cent.
It has been down sharply over the past two months.
There was also a sizeable drop on households’ perceptions about their financial situation in a year’s time.
And a measure of economic conditions in the next year is down 20 per cent over the past three weeks.
Ahead of the Budget, Mr Hockey this morning said he was prepared for criticism.
“If you are only looking in the budget for your own interest then you may be disappointed,” Mr Hockey said.
“But if you are looking for the national interest, you’ll be cheered.”