Westpac Survey: Consumer Outlook Improves by 8.1% in September
Australian consumers have regained their positive outlook in the present month, thanks much to the steady cash rate benchmark being implemented by the central bank in the past quarters plus the economic recovery posted at the close of the first half of the current year.
According to the Westpac-Melbourne Institute Index of Consumer Sentiment survey released on Wednesday, consumer confidence shot up by 8.1 percent in September to 96.9, coming from the 89.6 points in the previous month that economists said was the worst level in the past two years.
The strong gains, however, still fell short of the neutral mark of 100 and inferior by at least 14 percent from the readings registered in the same period last year.
Westpac chief economist Bill Evans told the Australian Associated Press (AAP) that while the general condition is somewhat cautiously optimistic, local consumers are buoyed by the immense likelihood that the Reserve Bank of Australia (RBA) will either keep the existing interest rate or implement a cut back as per the state of the domestic and international economies.
Households, at least, are getting a breather amidst the uncertain signals gleaned from local and offshore economic activities, Evans said.
"Concrete evidence of the improved outlook for interest rates came shortly after the August survey when the major banks actually lowered their fixed rate mortgage rates," he added.
More so, economists are under the impression that good economic numbers realised during the June quarter spurred better sentiments among local consumers and Evans agreed as he pointed out that "the development gained particularly wide media coverage and would have boosted households' spirits."
Still, many Australians remain wary of their general economic prospects despite signs that many are planning to go ahead on plans to purchase new homes, a spectre that could suffer some hold offs, Westpac said.
The survey concluded that households are harboring reservations on opening up their wallets, highlighting the reality that while good times are beckoning "there is a risk that, while seeing value, they will not be prepared to act on this."
The months ahead, Evans predicted, will not see dramatic jump on spending sentiments and partly to blame is the weakening labour market plus the pressures attached with the unsteady global economic condition.
More so, the Westpac survey believes that if any movement on the policy rate will be implemented by the RBA in the coming months, it will be downward, which should at least allay concerns of more burdens among Australian households.