Australian consumer confidence posted a modest increase last week, even as fears grow over the global economic impact of an escalating trade war. According to the latest ANZ-Roy Morgan consumer confidence survey, the index rose by 1.5 points to 86.8—signaling cautious optimism among Australian households.

Economist Sophia Angala of ANZ noted that most of the data was gathered before the Trump administration’s recent announcement of widespread tariffs on key U.S. trading partners. The announcement has since sparked global market volatility, with major economies, including China, responding with retaliatory trade measures.

Weekly inflation expectations edged down to 4.6%, a 0.1 percentage point decrease, while the four-week moving average held firm at 4.8%. This suggests that, although inflation concerns persist, immediate price expectations may be easing slightly.

However, sentiment around household spending softened. The subindex measuring whether it is a good time to buy major household items dropped by 2.5 points, reflecting consumer caution amid ongoing economic uncertainty.

The ANZ-Roy Morgan survey is a key indicator of Australian economic sentiment. It is based on responses from 1,006 participants across the country, collected via online and phone interviews in the week ending Sunday.