Goyder upbeat on shoppers

Richard Goyder is the chief executive of Wesfarmers. He told a Melbourne business lunch that consumer confidence in Australia is improving, describing the country as a “hypochondriac” but saying he sees “green shoots on consumer confidence” driven by recent interest rate cuts and easing worries about the European debt crisis.

The article notes Wesfarmers owns major retail brands such as Coles and Bunnings as well as resource assets including coal mining and gas processing, so the company has both retail and resource sector exposure.

Goyder pointed to 18 years of consecutive growth, strong employment with relatively low unemployment, a government attempting a fiscal surplus, and a Reserve Bank that has significant room to move on monetary policy as reasons Australia is in relatively good shape.

He used a colorful comparison: Europe was described as being “on life‑support,” the US “in the general ward,” and Australia “in the ward for hypochondriacs,” suggesting Australia’s issues are often overstated compared with Europe and the US.

Goyder said the resource sector was “materially worse,” indicating that while consumer-facing parts of the economy may show improvement, resource‑sector conditions remain weak according to his comments.

Quoting a US fund manager, Goyder explained that with markets stabilising, investors look at their superannuation and say “at least it’s not going down.” For everyday investors this suggests cautious relief — stable or flat returns can be seen as a positive sign after volatility.

Goyder linked recent interest rate cuts and commentary about further cuts, along with the cooling of the European debt crisis, to marginally positive signs for consumers — which could support spending at retailers like Coles and Bunnings owned by Wesfarmers.

The article states that Wesfarmers was set to release its results next week.