The Federal Budget has been blamed for consumer confidence falling to its lowest level since August 2011.
The Westpac-Melbourne Institute of Consumer Sentiment fell 6.8 per cent to 92.9 in May. Anything below 100 suggests there are more pessimists than optimists.
However a similar fall was recorded this time last year, in response to Labor's last budget, despite an interest rate cut from the Reserve Bank.
The report also revealed that 59.2 per cent of respondents expect the Federal Budget to have a worsening impact on family finances over the next 12 months.
Westpac says, despite the overall negative response, those surveyed don't expect to lose their job, eventhough the government's own forecasts has the unemployment rate rising to 6.25 per cent.
Attitudes towards the housing market took a tumble, with the index tracking assessments of whether now is a good time to buy a dwelling falling to their lowest level since November 2010.
It follows a similar report by ANZ-Roy Morgan yesterday, which showed consumer confidence suffered its biggest four week decline since October 2008.
For more on the index, SBS Business reporter, Ricardo Goncalves spoke with Bill Evans, Chief Economist at Westpac, to get more on his take on how the budget has hit consumer confidence, and what it means for interest rates.
