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Investing.com-- Australian consumer sentiment improved slightly in early-June, a private survey showed on Tuesday, as interest rate cuts and cooling inflation helped offset concerns over global trade and economic growth.
The Westpac-Melbourne Institute Consumer Sentiment Index rose marginally to 92.6 in June from 92.1 in May.
Westpac analysts noted that the overall mood still remained muted, with consumers in a pattern of “cautious pessimism.”
While a 25 basis point interest rate cut by the Reserve Bank of Australia in May did provide some support to sentiment, this was offset by persistent concerns over U.S. trade tariffs and their impact on growth.
Steadily declining inflation also aided sentiment, as did signals from the RBA that it will likely cut interest rates further in the coming months.
But consumers remained uncertain over household finances, and were also seen losing confidence in future gains, the Westpac data showed. Recent cooling in the labor market also undercut confidence in employment, although Australian jobs still remained relatively strong.
Still, consumer sentiment is expected to remain quashed in the coming months, especially if the Australian economy cools and if U.S. trade tariffs show few signs of lifting.