Australian consumer confidence falls

Australian consumer confidence fell this month, amid a rising jobless rate and a deteriorating economic outlook, adding to the case for the central bank to extend its interest rate cuts.

The Westpac-Melbourne Institute index of consumer sentiment fell 2.2%, or 2.1 points, to 89.9 in January, the first decline in three months. The index is down 12.8 percent from January last year.

A reading below 100 means pessimists outnumber optimists and the survey of 1,200 consumers has put gloomy people in the majority since February last year. New evidence of a slump in consumer sentiment came today when retailer David Jones said profit growth may stall in the first half. Shares of David Jones tumbled 8.3% to A$2.42, leading a 1.9% slide in the S&P/ASX 200 Consumer Discretionary Index. Harvey Norman fell 7.8% to A$2.12.