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Investing.com-- Australian consumer sentiment improved sharply in November amid increased optimism over the economy and family finances, even as the Reserve Bank downplayed expectations for lower interest rates, a private survey showed on Tuesday.
The Westpac-Melbourne Institute consumer sentiment index surged 12.8% in early-November, turning positive for the first time since early-2022. Excluding the COVID-19 pandemic, this is the index’s most positive reading in seven years, Westpac analysts said.
A bulk of the reading was driven chiefly by more confidence in the economy for the next five years, as consumer demand and housing markets gain momentum.
A deescalation in U.S.-China trade tensions also helped sentiment, as did new trade deals between Australia and the United States.
The Westpac survey also showed sentiment was not as rattled by the RBA’s November hold than initially feared, given that the central bank did not provide a more hawkish message on inflation.
Westpac expects the RBA to leave interest rates unchanged in December as well, citing a recent spike in inflation.
Consumers also remained very bullish on the outlook for house prices, Westpac said, although homebuyer sentiment remained muted.