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Australian Consumer Sentiment shows highest increase in 35 years

August 27th, 2009

Category: Retail Business News

Consumer Sentiment All Time High in Australia

Consumer Sentiment All Time High in Australia

Latest data suggests that consumers are feeling more optimistic about the state of the economy and in numbers never measured before.
The Westpac-Melbourne Institute has been tracking a metric called the consumer sentiment index.

The index is up 27.8 in the last 3 months which is the biggest three-month gain since the survey was started in 1975.

“The message is clear – as far as consumers are concerned, the worst of the current downturn appears to have passed,” said Westpac senior economist Matthew Hassan on Wednesday August 12th.

The last time that similarly large gains were observed was coming out of recessions in the 1980s and 1990s with gains of 22.8 and 20.3 percent respectively.

Additionally other indices showed increased belief in a recovery. The June quarter house prices rose 4.2 percent. And the jobless rate seems to have leveled off at 5.8 percent with some signs of increased hiring.

Some other metrics and their improvements:
•    12 per cent jump in share prices
•    1.2 per cent fall in petrol prices
•    4 US cent jump in the Australian dollar
•    Consumers’ economic outlook 11.2 per cent increase
•    ‘Good time to buy a major household item’ rose 2.2 per cent
•    ‘Time to buy a dwelling’ rose 1.6 per cent
•    ‘Time to buy a car’ also rose 3.1 per cent

“The continued rally in consumer confidence in August underscores the resilience of consumer demand,” Mr Hassan said.

For retailers this means that the worst may be over and that those posed to fulfil this increase in retailing purchase are likely to gain the most. And metrics are even showing that consumers are more interested in buying large items, cars and even homes.

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