Australian consumers are becoming more optimistic on the general outcome of the economy, but the most important aspect of spending is still something that they are holding back.

According to a survey of 1200 people by Westpac and the Melbourne Institute showed its index of consumer sentiment rose 0.4 percent to 97.2, building on a 8.1 percent jump the month before. The index was still down 16.9 percent on October last year.

Westpac chief economist Bill Evans thought the steady result likely reflected the domestic and global affairs, which is a mix of good and bad news.

At the domestic front, the prospect of lower cash rates and the lingering debt crisis among the Australia's trading partners in the EU have created a mixed sentiment of dread and hope.

Nevertheless, even a slight glint of hope is good enough to bolster the confidence of business and industries relying on consumer spending especially this coming Yuletide season.

According to Reuters, the index measuring family finances compared to a year ago firmed 2.3 percent, while that for family finances over the coming 12 months increased by 3.0 percent.

The index reflecting economic conditions for the next 12 months nudged up 0.9 percent in October, after a 16.6 percent surge in September, while that for the next five years rose 4.1 percent.

The only decline came in the measure of whether it was a good time to buy major household items, which fell 5.6 percent.

Mr Evans said the drop could reflect the sharp fall in the Australian dollar, which could have affected consumer perceptions of affordability.

Overall, the survey's expectations index rose 2.7 percent to 93.4, while its index of current conditions dipped 2.6 percent to 103.0, Reuters reported.