Australia’s Westpac–Melbourne Institute Consumer Sentiment Index plunged 12.5% mom to a 2-1/2-year low of 80.1 in April 2026, reversing a 1.2% rise in March. The sharp drop was driven by a surge in fuel prices amid the U.S.–Israel conflict with Iran, as well as a further 25bp rate hike by the Reserve Bank. Household finances weakened sharply, with assessments vs a year ago down 16.7% to 66.8, and expectations for the next 12 months fell 13.9% to 84.0. Meanwhile, views on economic conditions over the next year dropoed 12.4% to 75.3, and the five-year outlook eased 5.1% to 91.4. The “time to buy a major household item” index slid 15.0% to 83.3. Job loss fears climbed 9.7% to a 5-1/2-year high of 147.8. Westpac economist Matthew Hassan noted the current shock is weighing more heavily on labour market expectations than the 2022–24 ‘cost-of-living crisis’. He expects the central bank to stay focused on inflation, forecasting a 25bp hike in May, with further tightening later this year.
