Consumer sentiment surges in July


A more upbeat view of the economy has seen the Westpac–Melbourne Institute Consumer Sentiment Index rise by 11.1pc

Consumer sentiment surges in July
Consumer sentiment surges in July
July 14, 2010

A more upbeat view of the economy was recorded in July, with the WestpacMelbourne Institute Consumer Sentiment Index rising by 11.1 percent to 113.1 from 101.9 in June.

The bounce-back comes as welcome news to business after the index tumbled by 12.3 percent since April.

Westpac's Chief Economist Bill Evans admits the Bank was surprised by the strength of the recovery.

"Since the last survey the RBA has held rates steady for a second consecutive month and the dispute over the mining tax has been largely settled," Evans says.

"News on the labour market has also buoyed households with the unemployment rate falling to 5.1 percent and 46,000 new jobs created in June," he says.

COMPONENT BREAKDOWN

According to results out today, all components of the Index increased in July.

The assessment of family finances today relative to a year ago rebounded 17.2 percent after a 17.7 percent slump in June.

Expectations for family finances over the next 12 months rose by a more subdued 7.3 percent but had seen a milder fall in June.

In a positive sign for retailers, consumers’ opinions on 'whether now is a good time to buy major household items' rose 7.3 percent, more than reversing the 5.6 percent fall over the previous two months.

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