Australian consumer confidence jumped to a 14-week high following the release of the federal budget, hinting that news of income tax cuts and an expected earlier return to surplus has gone down well with households.
The ANZ-Roy Morgan consumer confidence index rose 1% to 120.8 — the fifth consecutive weekly gain in a row — leaving overall confidence at the highest level since early February.
Sentiment currently sits well above the series long-run average of 113.0.
As seen in the chart below from ANZ, confidence levels are also well above the levels seen following last year’s budget.
“The rise in sentiment was broad based, with households particularly optimistic about economic conditions and future financial conditions,” said David Plank, Head of Australian Economics at ANZ.
“This suggests that the Budget and the personal income tax cuts therein have been well received.”
This next chart from ANZ shows sentiment towards family finances and the economy is now well above historic norms.
Plank says Australian wage and employment reports in the coming days could “set the tone for confidence in the short run”.
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