Australia: Consumer Sentiment lifts - Westpac
|Matthew Hassan, Research Analyst at Westpac, notes that Australia’s Westpac Melbourne Institute Index of Consumer Sentiment rose 3.9% to 106.1 in July from 102.1 in June.
Key Quotes
“The consumer mood showed a clear improvement in July.”
“This is the eighth month in which the Index has been above 100, indicating optimists outnumber pessimists, a clear turnaround on the previous year in which 11 out of 12 readings were below 100.”
“Despite the positive run, the overall level of sentiment is still not that strong – at 106.1, the July reading compares favourably to recent years but is still below the 108.3 average recorded over the ten years prior to the GFC, and peaks well above the 110 mark.”
“The survey detail shows the latest lift in sentiment is being driven by growing optimism about the economy.”
“Some of this lift likely reflects developments around tax policy with the Government’s multi-year tax cut package passing into legislation in June and the first round of relief coming into effect on July 1.”
“The Reserve Bank Board next meets on August 7. The Governor has made it plain in recent comments that the official cash rate is unlikely to be changed any time soon. While the improved tone to sentiment this month will be a welcome shift given the Bank’s concerns about an uncertain outlook for the Australian consumer, the detail will be less comforting with family finances still under pressure, what had been a steady improvement in labour market expectations stalling, and further signs of weakness in housing-related sentiment. All up, a lift in consumer demand still looks unlikely near term.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.