Consumers and property owners are more confident following the Reserve Bank of Australia's (RBA) decision to cut interest rates, a new survey from Westpac has found.
The Westpac/Melbourne Institute Index of Consumer Sentiment increased by 6.3 per cent in November, rising from 97.2 to 103.4. For the first time since June last year the index is above the neutral level, meaning that optimists outnumber pessimists in the cross section of people surveyed.
Confidence among mortgage holders rose 13.9 per cent and confidence among people who own their house mortgage-free went up by six per cent.
Bill Evans, chief economist at Westpac, said the RBA's cut in interest rates has had the desired effect and left room for further action.
"Our interpretation of the Bank's recent statement on monetary policy is that it is troubled by developments in Europe and, due to a more downbeat assessment of the domestic economy, sees clear room to cut further," he said.
Figures released at the start of the month (November 1st) by the Australian Bureau of Statistics revealed house sales fell by 3.5 per cent in September.
Posted by Steve Douglas
