Latest news with #Westpac-MelbourneInstitute
Perth Now
12 hours ago
- Business
- Perth Now
Surprising group feeling good about rate cut
A surprising group of Australians are feeling better about their personal finances and the broader economy after the Reserve Bank's August rate cut gave households a much-needed confidence boost. The latest Westpac-Melbourne Institute survey showed consumer sentiment jumped 5.7 per cent to 98.5 in August. This was its highest level in nearly four years. A score of 100 or better suggests Australians are optimistic about the future. But the soaring consumer sentiment is not coming from the group of people you would expect to benefit from lower rates. Australians are feeling better on the back of interest rate cuts. NewsWire/ Monique Harmer Credit: News Corp Australia Westpac head of Australian macro-forecasting Matthew Hassan said overall consumers were feeling better about cost of living. 'Interestingly, the gains are not confined to or even being led by the mortgage belt, the section of consumers that stand to benefit most directly from lower interest rates,' he said. 'Some of the strongest improvements in the August month were among renters, suggesting that easing cost-of-living pressures – including slower growth in rents – has also been a positive.' Mr Hassan said the sharp pick up in consumer sentiment came just days after the RBA lowered the official cash rate by 25 basis points to 3.60 per cent. 'The RBA's forecasts also imply that rates will likely need to be a little lower to keep the economy on track, a point the RBA governor highlighted in the post-decision press conference' he said. 'That looks to have reinforced consumer expectations that mortgage interest rates are headed lower, giving a broadbased boost to sentiment.' Australia's Cash Rate 2022 It was the third interest rate cut of the cycle, with cash-strapped mortgage holders getting 75 basis points of rate relief since February. Consumer sentiment first ticked up after the income tax cuts in the middle of last year and steadily rose on the back of each RBA rate cut. Although there was a pause in sentiment in April when Australians feared the worst when US President Donald Trump announced his tariff policy The rise was broadbased, with all five measures Westpac-Melbourne Institute lifted over the month. The biggest lift was consumers feeling about their personal finances. The 'family finances vs. a year ago' sub-index surged 6.2 per cent in August to 84.2, still a pessimistic read but only marginally below the long-run average of 88, while expectations about the 'family finances over the next 12 months' are up 5.4 per cent to 106.8. Australians are also starting to feel optimistic about making big purchases. Australians now say it's a good time to buy a big-ticket item. NewsWire / John Appleyard Credit: News Corp Australia The 'time to buy a major item' sub-index jumped to optimistic in the month of August as crossing the 100 mark. The RBA rate cut gave a substantial boost to housing-related sentiment. The 'time to buy a dwelling' index jumped 10.5 per cent to 97.8, a new four-year high and up 37 per cent on a year ago, albeit still well below the historic rate of 120. Mr Hassan said the long run of consumer pessimism may finally be coming to an end, although he pointed out households should not expect back-to-back rate cuts. 'Further easing will likely be needed to sustain gains,' he said. However, he said the RBA did not need to rush to cut rates further. 'Inflation is inside the RBA's target range and likely to stay there but the unemployment rate is still low by historical standards,' he said. 'We expect the board to take things meeting by meeting and respond to the flow of data as it comes in.' The RBA monetary policy board next meets on September 29-30.
Business Times
16 hours ago
- Business
- Business Times
Australia's August consumer sentiment boosted by rate cuts
[SYDNEY] A measure of Australian consumer sentiment improved sharply in August as the third cut in interest rates this year bolstered the outlook for finances and the economy, a survey showed on Tuesday. A Westpac-Melbourne Institute survey showed its main index of consumer sentiment climbed 5.7 per cent in July to 98.5, the highest reading since early 2022. The reading under 100 means pessimists still outnumber optimists, though only just. The pick-up came after the Reserve Bank of Australia cut interest rates a quarter point to 3.60 per cent and left the door open to further easing this year. REUTERS
Perth Now
15-07-2025
- Business
- Perth Now
Australian shares gain as consumers' mood lifts
The local share market has moved higher as a long-running survey of Australian consumer sentiment posted another modest gain despite last week's surprise move on interest rates. At noon on Tuesday, the benchmark S&P/ASX200 index was up 36.7 points, or 0.43 per cent, to 8,607.1, while the broader All Ordinaries had gained 36.9 points, or 0.42 per cent, to 8,852.2. The Westpac-Melbourne Institute Consumer Sentiment survey, based on a poll of 1,200 Australian adults conducted last week, showed a lift for a third straight month. "While the mood improved a touch for the month as a whole, responses over the survey week show a clear disappointment following the RBA's surprise move to leave rates on hold at its July meeting," said Westpac's head of Australian macro forecasting, Matthew Hassan. AMP economist My Bui said that compared to the longer-term trend, Australian consumer confidence remained soft and way below its long run average. In China, the National Bureau of Statistics reported that the world's second-biggest economy grew at 5.2 per cent in the June quarter, slightly better than consensus estimates of 5.1 per cent growth. Ten of the ASX's 11 sectors were in the green at midday, with materials flat. Tech was the biggest mover, rising 2.1 per cent. Life360 had gained 9.0 per cent to an all-time high of $35.55, Appen had climbed 5.6 per cent to $1.135 and Weebit Nano had advanced 6.4 per cent. Eftpos providers Tyro Payments and Smartpay Holdings were down 5.2 and 1.9 per cent, respectively, after the Reserve Bank proposed banning surcharging on debit and credit cards. Hub24 had advanced 5.5 per cent to an all-time high of $99.71 after the wealth management platform announced strong growth in the fourth quarter, with funds under administration climbing $5.3 billion. The big four banks were all at least slightly in the green, with CBA up 0.3 per cent, ANZ up 0.4 per cent and NAB and Westpac posting very marginal gains. In the heavyweight financial sector, BHP was down 0.7 per cent, Fortescue had dropped 1.0 per cent and Rio Tinto had fallen 0.9 per cent. The Australian dollar was buying 65.55 US cents, from 65.59 US cents at the close of business on Monday.
Business Times
15-07-2025
- Business
- Business Times
Australia's July consumer optimism restrained by rate surprise, survey shows
[SYDNEY] A measure of Australian consumer sentiment improved marginally in July, a survey showed on Tuesday, though optimism on the economy was tempered by a central bank decision to skip a cut in interest rates. A Westpac-Melbourne Institute survey showed its main index of consumer sentiment crept up 0.6 per cent in July, following an equally restrained 0.5 per cent increase in June. The index was 12.6 per cent higher than a year earlier at 93.1, but being below 100 that still meant pessimists outnumbered optimists. The Reserve Bank of Australia surprised markets last week by holding rates at 3.85 per cent, when many had looked for a further cut following easings in February and May. Matthew Hassan, Westpac's head of Australian macro-forecasting, noted those surveyed before the decision reported an index reading of 95.6,while those surveyed after produced a reading of just 92. 'The reaction checked what would probably have been a solid rise,' said Hassan. 'It still leaves the consumer mood stuck at 'cautiously pessimistic' levels overall.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up A separate weekly survey from ANZ found a similar souring in mood, as its index dropped 2.1 points to 86.5 led by concerns over the economic outlook. Likewise, the Westpac survey showed its index of the economic outlook for the next year nudged up 1.8 per cent, while that for five years fell 2.8 per cent. Family finances compared to a year ago did enjoy a bounce of 5.0 per cent, while the outlook for the next 12 months picked up by 2.6 per cent. In a disappointing note for retailers, the index of whether it was a good time to buy a major household item dropped 2.6 per cent. REUTERS
AU Financial Review
14-07-2025
- Business
- AU Financial Review
ASX to rise, Wall St edges up on US-EU trade talk hopes
Australian shares are set to rally after President Donald Trump signalled he's willing to negotiate on tariffs with the European Union, easing some of the concerns stoked by the issuing of tariff letters over the last week. All three US benchmarks reversed early losses to trade modestly higher in afternoon trade. While some strategists have increased their year-end targets for the S&P 500, Morgan Stanley's wealth management investment committee, led by Lisa Shalett, is wary. 'Investors have added a new level of bravado, viewing tariffs as a nonissue.' 'With stock indexes again near all-time highs, investors appear to be stretching to embrace a Goldilocks thesis. The narrative seems to be premised on the new tax bill's support of a capex boom, with limited tariff-related growth and inflation risk. We see S&P 500 gains beyond the 6500 6600 range as difficult to achieve, however, given ongoing puts and takes.' Market highlights ASX futures are pointing up 58 points or 0.7 per cent to 8606. All US prices near 2.30pm New York time. Today's agenda The key focus will be on the prime minister and his visit to China this week. On Tuesday, there's one data print of note: the June Westpac-Melbourne Institute Consumer Sentiment measure. eToro's Josh Gilbert: The WMI 'measure is a fairly reliable watermark for consumer attitudes in the country. Sentiment has been improving month-over-month following a big dip in April. Last week, ANZ-Roy Morgan Consumer Confidence index climbed for a third straight week, up by 1.4pts to 88.6, and Westpac's June figures will probably indicate similar upward momentum'. Overseas, China is set to report second-quarter GDP and June trade, retail sales and industrial production. The US is scheduled to release June CPI at 10.30pm. Morgan Stanley: 'We see core CPI prices at 0.28 per cent in June (2.96 per cent year-over-year). We think June will show more evidence of tariff pass-through, but the overall push remains mild with some heavily tariffed goods still showing weakness. We forecast a more meaningful acceleration in July and August. Top stories Chanticleer: Plenty won't like Matt Comyn's big fix for Australia. That's OK | The CBA chief executive may cop flak for putting some of the more controversial ideas on the table to solve the productivity crisis. But it's worth the risk. | Defeated Liberal candidate Gisele Kapterian has petitioned the High Court to re-examine 'a small number' of disputed ballot papers. | Shared optimism about the technology and a promised increase in jobs and prosperity are a useful counter to rising concerns about Australia's growth prospects, writes Jennifer Hewett.
