Australia Consumer Sentiment Rises In July: Westpac

(RTTNews) - Australia's consumer confidence improved in July despite an unexpected move by the central bank to leave the interest rates on hold, survey data from Westpac showed on Tuesday.

The Westpac-Melbourne Institute Consumer Sentiment Index rose 0.6 percent to 93.1 in July from 92.6 in June.

Westpac Head of Australian Macro-Forecasting Matthew Hassan said those surveyed before the announcement of central bank's decision reported an index read of 95.6 while those surveyed after reported an index read of 92.

Among five sub-indices of the consumer confidence index, two track assessments of family finances, two track expectations for the economy and one on whether consumers see now as a good time to buy a major household item. Three of the five sub-indexes improved in July.

The 'family finances vs a year ago' sub-index registered a solid 5 percent monthly rise and the 'family finances, next 12 months' sub-index posted a milder 2.6 percent gain to 101.4, survey showed.

Consumers' assessment about the economy showed a mixed trend in July, with near-term expectations improving slightly but longer-term expectations deteriorating.

The 'economic outlook, next 12 months' sub-index grew 1.8 percent to 94.1, while the 'economic outlook, next 5 years' sub-index declined 2.8 percent to 93.4.

The 'time to buy a major item' sub-index slid 2.6 percent to 97.6, partly unwinding last month's surge.

The Monetary Policy Board of Reserve Bank of Australia next meets on August 11 and 12. The June quarter data is likely to provide the confirmation of inflation remaining within the 2-3 percent target range, Hassan said.

This will clear the way for a 25 bps cut to the cash rate, followed up by another at the November meeting, Hassan added.