Floods knock confidence

Flooding in Queensland has seen consumer sentiment take a dive across the country.

The Westpac-Melbourne Institute Index of Consumer Sentiment fell by 5.7 per cent this month to 104.6, from 111 in December.

This was the first survey conducted since the onset of flooding in Queensland.

Westpac chief economist Bill Evans said it was an "extremely difficult survey to interpret" given the limited access to Queenslanders during the early days of the floods.

The survey covered the period of January 10 to 16 and coincided with some of the worst days of the floods.

"With limited communication possible, the Queensland component of the survey was held steady around 20 per cent of the total but reduced coverage was given to the metropolitan area," Evans said.

The result represents a significant fall in the index although it is still around 4 per cent above its long term average, he said.

It is now down 12.9 per cent from a year ago and is 8 per cent below its average level in 2010.

The index also showed consumer sentiment taking a hit in other states.

The "ex-Queensland" Index points to a fall in confidence of 3.2 per cent.

Despite these other states not being directly affected by the floods it is likely that perceptions of the implications of the floods for the national economy and their own financial positions have been adversely affected, Westpac said.

The survey also showed respondents were anxious about the short-term outlook.

The outlook for economic conditions over the next 12 months collapsed by 15.7 per cent (12 per cent ex-Queensland), whereas the five-year outlook was up by 0.2 per cent (2.8 per cent ex-Queensland).

- AAP