Malcolm Turnbull’s ascent to the Prime Ministership has given consumers reason to smile, with the Christmas spending outlook at a seven-year high. The Westpac/Melbourne Institute index shows consumer sentiment rose by 3.9 per cent in November to 101.7 points, lifting above 100 points and indicating there are now more optimists about the economy than pessimists.
Westpac chief economist Bill Evans said that apart from the brief surge in confidence following last May’s budget, this is the highest print for the Index since January 2014. “This is a cracking result,” he said. “The increase also comes despite the banks’ decisions to raise mortgage rates for both owner occupiers and investors.”
Most surprisingly, the confidence of respondents who hold a mortgage increased by 4.1 per cent – a larger lift than the rise in the overall Index. Consumers’ assessments of their personal finances, however, were presumably linked to the interest rate hikes and fell on average by 5.7 per cent, Mr Evans said.