Melbourne’s extended lockdowns have destroyed Australia’s Covid recovery: Westpac consumer sentiment


Proof Melbourne’s extended lockdowns have hurt Australia’s economic recovery with Sydney now seen as the national saviour

  • The Westpac-Melbourne Institute consumer sentiment reading dived in June 
  • Westpac chief economist Bill Evans blamed two-week lockdown in Melbourne 
  • Sydney and New South Wales now seen as the key to Australia’s Covid recovery 










Melbourne’s extended lockdowns have hampered Australia’s economic recovery by making consumers nervous and less likely to spend money.

Westpac chief economist Bill Evans said Victoria’s two-week Covid restrictions, ending on Friday, caused a sharp drop in a key consumer sentiment reading.

‘The latest fall in June is almost certainly due to concerns around the two-week lockdown in Melbourne,’ he said.

The Westpac-Melbourne Institute monthly barometer, measuring how upbeat Australians are about buying things, fell by 5.2 per cent in June.

Melbourne's extended lockdowns have hampered Australia's economic recovery by making consumers nervous and less likely to spend money. Westpac chief economist Bill Evans said Victoria's two-week Covid restrictions, ending on Friday, had caused a sharp drop in a key consumer sentiment reading. Pictured is Bourke Street in the city almost deserted

Melbourne’s extended lockdowns have hampered Australia’s economic recovery by making consumers nervous and less likely to spend money. Westpac chief economist Bill Evans said Victoria’s two-week Covid restrictions, ending on Friday, had caused a sharp drop in a key consumer sentiment reading. Pictured is Bourke Street in the city almost deserted

When people are pessimistic about the economy, they are less likely to spend money and create jobs.

The survey of 1,200 Australians was taken during the first week of Melbourne’s lockdowns.

Consumer sentiment is a key driver of the national recovery, with Sydney and NSW now seen as the key to reviving Australia’s economic activity as Melbourne falters. 

‘That resilience in NSW, our largest state, will be very important for supporting national sentiment and, in turn, sustaining the economic recovery,’ Mr Evans said.

Melbourne’s five million residents will finally be released from lockdown on Friday, but stifling restrictions will remain in place despite just one new Covid-19 case.

Despite the low infection rates, Melburnians will still be banned from having guests at their home, and even those in the regions will only be permitted to have two people over.

The Westpac-Melbourne Institute monthly barometer, measuring how upbeat Australians are about buying things, fell by 5.2 per cent in June. The survey of 1,200 Australians was taken during the first week of Melbourne's lockdowns. Pictured is Melbourne's Lygon Street

The Westpac-Melbourne Institute monthly barometer, measuring how upbeat Australians are about buying things, fell by 5.2 per cent in June. The survey of 1,200 Australians was taken during the first week of Melbourne’s lockdowns. Pictured is Melbourne’s Lygon Street

Acting Labor Premier James Merlino on Wednesday said metropolitan Melbourne would move to ‘most of the same settings’ already in place across regional Victoria, with masks still compulsory at public indoor areas as people were encouraged to work from home.

Those living in the city will now be allowed to leave home for whatever reason they want, with shops, restaurants and cafes allowed to open with strict capacity limits.

The existing 10km limit will be increased to 25km, meaning the only reasons to go further than 25km will be for work, education, caregiving or getting a vaccination.

The 25km travel limit for Melburnians is likely to reek havoc on regional businesses who rely on a major influx from the city over the upcoming long weekend. 

Melbourne's five million residents will finally be released from lockdown on Friday, but stifling restrictions will remain in place despite just one new Covid-19 case. Lygon Street pictured

Melbourne’s five million residents will finally be released from lockdown on Friday, but stifling restrictions will remain in place despite just one new Covid-19 case. Lygon Street pictured

The Westpac-Melbourne Institute consumer sentiment reading score of 93.7 was below the 100 level where there are more optimists than pessimists.

It is now back the January level when Sydney’s Northern Beaches and Brisbane had been put into lockdown. 

Nonetheless, Australians are still upbeat about the share market with the benchmark S&P/ASX200 hitting a record high on Friday, surpassing the previous peak of February 2020 before the World Health Organisation declared a Covid pandemic. 

The monthly consumer sentiment survey showed 12.1 per cent of consumers regarded the share market as the ‘wisest’ place for savings – the highest score in a decade.

The ASX200 on Wednesday afternoon was trading at 7,285, slightly below Friday’s record high of 7,295.

The new rules for Melbourne that are coming into effect on Friday

MELBOURNE 

– Stay-at-home order ended, so people can leave home for any reason

– 25km travel limit to stop travel to regional Victoria

– Outdoor gatherings capped at 10 people, with still no visitors in homes

– Schools to reopen for face-to-face learning

– Masks no longer needed outdoors but must be worn inside

– Funerals capped at 50 people and weddings at 10

– Restaurants and cafes to reopen for 100 people maximum outside and 50 people inside

– Retail shops can reopen with a one person per four square metre density limit

– Hair and beauty will reopen but masks must be worn

– Community sport is allowed, and auction can happen with 50 people outdoors

– Offices capped a 25 per cent capacity

Regional Victoria

– Two adults allowed to visit another home, with children not included in the cap

– Public gatherings capped at 20 people

– Restaurants and cafes can have 150 people seated outdoors or 75 indoors

– Religious ceremonies capped at 150 people or 75 indoors, with funerals at 75 and weddings at 20

– Offices capped at 50 per cent capacity



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