Australia consumer sentiment hits 6-mth low in April on US tariff worries- Westpac

Australian consumer sentiment fell to a six-month low in early April, as rising global trade tensions and fading optimism over domestic interest rate cuts weighed on household confidence, a private survey showed on Tuesday,

The Westpac-Melbourne Institute consumer sentiment index slumped 6% in April to 90.1 from 95.9 in March. The index had jumped 4% to reach a three-year high in March.

Concerns over escalating global trade tensions under U.S. President Donald Trump added to growing unease about the global economic outlook, while the initial boost from the Reserve Bank of Australia’s (RBA) February rate cut appeared to fade, the Westpac survey stated.

Sentiment fell sharply during the survey week, as markets dropped following U.S. President Trump’s April 2 announcement of new reciprocal tariffs, according to Westpac.

Respondents surveyed before the news reported an index of 93.9, only slightly below March’s 95.9, while those surveyed after saw sentiment plunge to 86.6 — a near 10% drop from the prior month.

“With the situation still deteriorating, there is a clear risk of more significant sentiment declines in the months ahead,” the survey stated.

Looking ahead, all eyes are on the Reserve Bank of Australia’s next policy meeting on May 19–20.

Westpac expects worsening global conditions and continued signs of easing inflation to prompt a 25bp rate cut at the RBA’s May meeting.