(Australian Associated Press)
Consumer confidence has hit its highest point since February, on the back of strong full-time jobs growth and a fall in the unemployment rate.
The latest ANZ-Roy Morgan Consumer Confidence Index rose 2.9 per cent to 118.4 points in the week to July 30, marking an increase for the second consecutive week.
Driving the rise was a significant 12.3 per cent jump in consumers’ views towards current economic conditions and a strong climb in sentiment around future economic conditions.
ANZ head of Australian economics David Plank said confidence had made an impressive recovery from its recent low and reversed most of this year’s decline.
“Particularly encouraging is the sharp increase in sentiment around economic conditions,” Mr Plank said.
“This rise is likely related to strong full-time jobs growth and the fall in the unemployment rate since the start of the year.”
The total number of people with jobs rose by 14,000 in June, with full-time employment up by 62,000 and part-time jobs down by 48,000, the Australian Bureau of Statistics said in July.
The unemployment rate was 5.6 per cent in June, unchanged from a revised May figure.
Mr Plank said a solid global economic environment and a stronger local currency had also been supportive.
“On occasion, there is some correlation between the two (Australian dollar and sentiment), though the relationship is volatile and may reflect the influence of other factors rather than being causal.”
Despite the overall increase, households’ views around current and future financial conditions slipped, by 1.2 per cent and 0.9 per cent, respectively, for the week.
Inflation expectations bounced 4.4 per cent for the week but were unchanged on a four-week average basis.