The Score

Q1-2026 Analysis

The Pulse collapsed by 10 points to -5 as Australians came to terms with the December 2025 Bondi terrorist attack and faced their first interest-rate hike in over two years. It confirmed, despite previous hopes, that the cost-of-living crisis was not over.

Of greater concern is that this collapse occurred prior to the US and Israel attack on Iran and the ongoing consequences.

Uncertainty was rising at the start of the year, and due to subsequent events, that trend looks set to continue.

At the end of March, Australians were not feeling confident, cutting discretionary spending and feeling pessimistic about the future. Politically, One Nation has benefited from this environment, with Australians now comfortable to declare their support for the minor party and, as evidenced in South Australia, vote for them.

This put pressure on the Coalition, which once again split and then reunited. Sussan Ley was ousted by Angus Taylor as Liberal Leader, and Matt Canavan was elected Nationals Leader following the resignation of David Littleproud.

The Q1 Pulse demonstrated Australia is under compounding pressure. All signals point to a further decline in the Pulse in Q2.

Outlook for Q2-2026

We predicted 2026 would be dominated by the Royal Commission on Antisemitism and Social Cohesion. That call now looks wrong. 2026 will be dominated by war and the threat of recession.

US and Israel attacked Iran, creating tension across the Middle East and triggering an energy shock and the closure of the Strait of Hormuz. The implications of this extend beyond the very real prospect of fuel rationing, to shortages of fertiliser or skyrocketing costs of plastics.

Analysis from Citi finds that every 10¢/litre increase in petrol price costs consumers $1.6 billion per year. This compares to the $1.8 billion cost of a 25 basis-point increase in the interest rate.

Treasurer Chalmers had previously hinted that the upcoming 2026-27 Federal Budget in May would focus on major reform and spending-restraint to make room for private sector spending. It will be challenging to maintain this given the negativity from business and consumers.

Considerations

Reputation: Do you have the reputational strength to make difficult decisions while maintaining the trust of key stakeholders?

Positioning: Are there opportunities in the current environment?

Messaging: What is the impact of the fuel crisis on your organisation, and have you segmented your messaging to align with audience expectations?

History: 2019 to 2026

Stepping back and viewing The Pulse over time illustrates the volatility of the pandemic. It appeared that we had returned to stability following the 2025 Federal Election; however, now it seems volatility is the new normal.

PulseCheck Methodology

York Park Group wanted PulseCheck to be an objective and subjective measurement. In developing the methodology, we considered:

• How do voters in the community feel generally against their actions?
• What are business perceptions against the decisions they make?
• How to answer these questions with data that already exists?

The Pulse is measured on a scale between -50 and +50, with 0 set as a neutral score, indicating that, socially, economically and politically, Australia is neither positive nor negative. The majority of the data sets used date back to 2019. This provides important context of where we are sitting compared to the black swan event of the pandemic.

For context, a record low -47.8 was recorded in April 2020, when business conditions and confidence were at -50 and -34 respectively as the scale of the pandemic became clear. Conversely, and coincidently exactly a year later, a record high of +30.4 is recorded, when the vaccine rollout was in full swing, with record high consumer sentiment and positive business confidence and conditions of 21 and 32 respectively.

Formula

The Pulse is formulated as a weighted sum of normalised scores assigned to each indicator. Data scientists at Klara have created linear spline functions – line segments joined at specified points – to normalise the indicators.

For each indicator, a total of 11 scores between -50 and 50 have been assigned to a representative sample of indicator’s values. The result is an adaptable but consistent and objective methodology that normalises the various indicators into a unified scale.

Once normalised, each indicator is given a weighting that determines the relative influence of the indicators on the overall Pulse score. The weightings were selected to achieve a balance between more objective measures that reflect actual spending or economic conditions (e.g. ABS data and NAB business conditions) and more subjective measures that reflect consumer sentiment, business confidence, and political satisfaction. The weightings for each source are set out below.

Consistent Updates

Together, York Park Group and Klara have built PulseCheck to capture changes in Australia’s economic, social and political climate.

PulseCheck offers a data-driven lens through which organisations can proactively manage their reputation in a dynamic and often unpredictable environment. As new sources emerge, PulseCheck will continue to refine its approach – remaining a reliable, transparent, and relevant guide for decision-making in an increasingly complex world.