Consumer confidence has dropped significantly in the first Morgan survey for 2008. The Roy Morgan Consumer Confidence Rating is 118.6, down 8.2 points from December and 5.3 points below the January 2007 result of 123.9.

The fall has been driven by a large increase in the number of Australians who expect “bad” economic conditions in Australia in the next year – now 25% (up 12%), compared to the 38% (down 9%) who expect “good” economic conditions in the next 12 months.

“Consumer Confidence usually increases in January,” pollster Gary Morgan says. “However, this year international economic concerns appear to be having an effect on Australians’ consumer confidence.”

The number of Australians expecting good economic times over the next five years is down 4% to 35%, compared to 18% (up 4%) of Australians who expect bad economic times over the next five years.

Thirty nine per cent (down 5%) of Australians expect to be better off financially this time next year, while the number who expect to be worse off is up 4% to 16%.

Thirty three per cent (down 5%) of Australians say their personal financial situation is better now than it was last year, while the number who say they are now worse off is up 5% to 25%.

Currently, 52% (up 5%) consider now a good time to buy major household items, while the number of Australians who say now is a bad time to buy is down 2% to 20%.

Consumer confidence is highest in Western Australia (122.5). South Australians are the least confident (114.6).