e overall health of the economy. According to ANZ economist Sophia Angala, the fall in long-term confidence coincides with global instability – including trade policy uncertainty, political volatility in Japan and France, and the recent US government shutdown.  “The softness in confidence was broad-based, but notably, household confidence in the economy over the next five years has dropped to its lowest level in over 15 years,” said Angala in a statement. These external factors, while distant, contribute to a broader environment of economic anxiety that filters down to household sentiment, which was already facing subdued household spending. Consumer confidence For retailers, sustained low consumer confidence represents both a warning and a strategic challenge.  When confidence hovers below the neutral level of 100 for an extended period, as it has now for more than a year, it indicates entrenched caution among households.  While household essentials like groceries remain stable, categories dependent on discretionary spending, including apparel and homewares, face pressure. The decline in confidence appears to be primarily driven by mortgage holders, possibly due to discussions about the possibility of an RBA cash rate hold in November. However, confidence also fell for renters and outright homeowners. Roy Morgan and ANZ’s research also highlighted that the net economic outlook softened, with only 9 per cent of Australians anticipating favourable conditions in the next 12 months, compared to nearly a third (32 per cent) foreseeing worsening times. Business confidence On October 14, the National Bank of Australia (NAB) released its data on business sentiment for September, reporting that it remains resilient. NAB chief economist Sally Auld said business conditions held their ground in September and continued to improve profitably. “The September survey showed continuing positive results in the headline figures,” said Auld in a statement. “Both business confidence and conditions appear to be consolidating just above their long-run average levels after improving through mid-2025,” she added. The NAB September survey signalled that businesses are holding up well despite reports of dwindling consumer confidence. NAB’s business conditions index was unchanged at +8, and confidence rose three points to +7, a touch above long-run averages. Moreover, sales rose three points to +16, and profitability edged up to +6 – continuing an upward trend since May. The steady NAB survey suggests underlying resilience in Australia’s business sector, a sentiment that is reflected in Deloitte’s annual ‘Retail Holiday Report’.  The report surveyed 150 Australian retail executives and found that 84 per cent expect stronger sales this year, a significant increase from 51 per cent last year. Additionally, one in three shoppers plans to increase spending, especially during November sales events. Retailers are anticipating that over half of their holiday revenue will come from Click Frenzy, Black Friday and Cyber Monday combined, with Christmas and Boxing Day still expected to deliver the strongest sales on their own. “For the first time since this survey began, retailers expect to generate 50 per cent of their holiday revenue through this period,” said Deloitte consumer products and retail partner Damien Cork in a statement.