SEC Newgate Mood of the Nation - July 2024

Australians still pessimistic about inflation, interest rate outlook.

SEC Newgate’s latest Mood of the Nation survey finds that Australians don’t believe inflation is going down, with many fearing interest rates will continue to rise.

There are still high levels of pessimism among Australians about the immediate prospects for the national economy, even though their own personal financial difficulties appear to have stabilised. The survey of n=2,021 Australians was taken from 17 to 23 July.

Australians are increasingly taking a cost-of-living lens to most issues, and challenging economic perceptions confront the Albanese Government as it enters the final phases of its first term. Electricity prices, higher government spending and taxation, and increasing business profit margins are perceived as the highest drivers of inflation.

While the perception of the Federal Government has stabilised, the RBA’s decision on interest rates next week has the potential to impact community sentiment. However, the Federal Government’s key economic decisions appear to have been received well, with energy bill support, Stage 3 tax cuts and Future Made in Australia all supported or considered the ‘right thing to do’ by the majority of Australians.

The survey has also found that support for renewables and the energy transition has rebounded in the wake of the nuclear debate, although electricity prices remain a major concern. The Opposition’s nuclear policy has yet to gain traction in the community, with support largely confined to Coalition voters.

Highest ever finding for unprompted cost-of-living concerns

Cost-of-living remains the top unprompted issue of concern for Australians, with 75% of participants mentioning it – up 6%. It’s driven by grocery prices, electricity bills and insurance premiums as the top contributors.

The survey also found that the Albanese Government’s tax cuts and energy bill rebates were considered the ‘right thing to do’ by the majority of Australians (63% and 71% respectively), but this has not appeared to have swayed the ongoing cost-of-living concern.

The national mood has improved slightly and returns to the norm

The national mood – indicated by our feelings in recent weeks – has improved by 5% since April, when the Bondi tragedy prompted nationwide concerns about social cohesion. This represents a return to the long-term average prevalence of both positive and negative emotions.

Given the persistent cost-of-living concern, the nation’s pessimism may be driven by widespread financial hardship. Around 4 in 10 Australians (42%) have reported experiencing financial difficulty, with this trend remaining stable over the past 12 months.

Limited confidence that inflation is falling

Despite a prolonged period of increased interest rates, Australians are now less confident that the country is getting inflation back under control. 75% have limited or no confidence that inflation will fall over the next 12 months – a 15% increase since February.

The survey preceded the release of official inflation data for the June quarter, which showed an increase for the first time since December 2022. It is also expectation of another interest rate rise; 46% of participants expect a rate hike when the RBA meets on Tuesday, 6 July.

Federal Opposition’s nuclear policy struggling to find new support

When asked to choose between building large-scale wind and solar farms with new transmission, or nuclear plants with existing transmission, wind and solar was the clear preference among participants (50% to 26%). Preferences appeared to be aligned to existing voting intention, with Labor/Greens voters favouring renewables and Coalition voters heavily favouring nuclear, suggesting the Coalition’s nuclear policy has done little to generate new support.

About 1 in 4 Australians (26%) were more likely to vote for the Coalition as a result of the policy, while 35% were less likely and 40% were unchanged. Nuclear power remains the third-least supported new electricity generation option after coal and gas.

Publicly funded channels remain the most trusted news sources

Results from this new question exploring news consumption show that ABC and SBS are the main places Australians turn to for “trusted information” about news and current affairs. This is true for all age brackets except for Australians over 65 years, who prefer commercial TV as a news source.

In all instances, ABC/SBS and commercial TV make up the two most trusted sources, while Google or internet searches and social media are also prominent among the younger (18-34) demographic.

Top 10 Sources of Trusted Information on News & Current Affairs

Australians don’t feel out of the economic woods yet

Despite the economic headwinds Australians personal financial situations have remained steady, suggesting the Federal Government’s tax cuts and electricity bill concessions may be having an impact – or at least are providing a short-term sugar hit.

The national and longer-term outlook, however, remains largely unchanged; 43% of Australians believe the economy will get worse in the next 3 months, and 47% expect it to worsen in the next 12 months.

Contacts

Contact us for more information about the full Mood of the Nation research report or if we can help you navigate community or stakeholder sentiment or expectations.

David Stolper, Partner, SEC Newgate Research – [email protected]

Sue Vercoe, Managing Partner, SEC Newgate Australia – [email protected]