Pensioners more than most were unnerved by last week's financial market gyrations, fearing for their retirement nest eggs.
New confidence figures show sentiment overall fell 2.3 per cent in February compared to January, but tumbled 13.5 per cent among retirees following the sell-off in Australian shares which saw tens of billions of dollars wiped off their value.
"Extensive media coverage of these developments would have unnerved respondents on two fronts," Westpac chief economist Bill Evans says.
"The impact on their own financial position and concerns for general global stability."
Despite this more negative tone, the survey still shows optimists outnumbering pessimists for the fourth straight month.
This followed 12 consecutive months where pessimists were in the ascendancy for all but one month.
The survey also found consumers continue to be more comfortable about the outlook for jobs.
Its unemployment expectations index fell 1.8 per cent in February, meaning more consumers expect the jobless rate to fall. It is now over 15 per cent lower than a year ago.
"Generally, as job security fears ease, employees are more likely to feel comfortable in pushing for stronger wage increases," Commonwealth Bank senior economist John Peters said.
However, despite the strong jobs growth in the past year, Mr Peters believes there is still a large amount of slack in the labour market.
"Thus, we think that a strong lift in wages growth from here is still a long way off," he said.
January labour figures are released on Thursday.
Economists are expecting a more modest rise in employment of 15,000 after the upbeat pace that saw a record 403,000 people get a job over 2017.
However, they expect this could be enough to see the jobless rate tick back down to 5.4 per cent per cent from 5.5 per cent in December and to a five-year low seen in October and November last year.
Australian Associated Press