The ANZ-Roy Morgan Australian consumer confidence fell 5.4 points to 63.1 in the week of March 16 to 22, ANZ reported Tuesday.

The four-week moving average eased 4.3 points to 70.5 points.

Australian consumer confidence has dropped to its lowest level since records started in 1973, driven by the Middle East conflict's effect on oil prices and economic outlook, as well as the Reserve Bank of Australia's (RBA) recent decision to raise the cash rate to 4.1%, said Sophia Angala, and ANZ economist.

Rising petrol prices push Australian inflation expectations to record highs, weakening household confidence and prompting the RBA to signal a final 25-basis-point rate hike in May, Angala added.

Weekly inflation expectations inched up to 6.9% from 6.7%, while the current financial condition indicator for 12 months fell 6 points to 56.9. The future financial conditions for the next 12 months decreased to 69.2 points from 78.2.

Short-term economic confidence for the next year fell 3.9 points to 52.2, while medium-term economic confidence for the next five years increased to 77.8 points from 76.7.

The "time to buy a major household item" subcategory fell 9.5 points to 59.3.