After almost 7 months, customer confidence in Australia plunged for the first time in November after the Central Bank increased borrowing costs on November 3 for the second consecutive month, and hinted that further increases should be expected.

According to figures revealed by the Westpac and Melbourne Institute survey of as many as 1,200 consumers interviewed from November 2 to November 8, a drop of 2.5% was recorded by the sentiment index for the month, taking the figure to 118.3 points.

According to Bill Evans, Chief Economist at Westpac, the recorded rise has been small when compared to the fact there had actually been two pretty substantial interest rate hikes, one after the other. "Given that this fall comes after a second consecutive increase in the Reserve Bank's overnight cash rate and associated increases in variable mortgage rates it has to be classified as a modest response", he shared.

Authorities have been quick to remind that the current level of the index is still 38.3% more than the level recorded last year for the same period.