Australia records highest consumer confidence since June

Consumer confidence has reached its highest level in Australia since June, and consumer sentiment is positive despite the possibility of another rate hike in September.

Four of the five consumer confidence subindices ticked upwards last week, with current financial conditions lifting 1.5 per cent.

Current economic conditions increased 1.1 per cent and future economic conditions jumped 2.6 per cent, according to ANZ-Roy Morgan’s weekly survey.

The time to buy a major household item marker also rose 2.4 per cent after a 5.5 per cent drop the week before.

ANZ economist David Plank said renter confidence jumped up last week and was now higher than before the Reserve Bank started lifting rates.

However, confidence among mortgage holders remained subdued.

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“…for people paying off a mortgage and for those who own their home confidence is sharply lower by 19 per cent and 13 per cent respectively since the RBA’s first rate hike in May,” Plank said.

While last week’s uptick in confidence was encouraging, Plank said the indicator remained in “very negative territory” considering the record low unemployment rate.

The Reserve Bank of Australia board is expected to lift the official cash rates for the fifth month in a row when it meets on Tuesday afternoon.

Provided banks pass on rate hikes to customers, another interest rate increase this month will lead to higher repayment for variable rate mortgage holders.

On Monday, Australian Bureau of Statistics data also showed Australian businesses performing strongly.

Company profits lifted a higher-than-expected 7.6 per cent in the June quarter and wages bills rose by 3.3 per cent in the same period.

With AAP. (Content has been tweaked for length and style.)