New Year pessimism increases savings demand

Aussies are increasingly pessimistic about the rising cost of living, a study has found.

A Newspoll survey for the Australian found that the number of people who think their standard of living will get worse rose to 24 per cent from 19 per cent in June following the official interest rate rise on December 1st.

The newspaper said that Aussies remain pessimistic in light of a continuing lack of job security and fears of further interest rate rises next year.

Business analyst IBISWorld reported this week that shoppers have become more conservative in their Christmas spending this year, with discount stores becoming more popular as a result.

Money worries will encourage Aussies to compare savings accounts and compare term deposits with the aim of having sufficient finances put away should conditions get worse.

Last week a report by News Limited found that banks are now competing for customer deposits by offering high interest savings rates and high term deposit interest rates.

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