Australians are a happy enough bunch at the moment, according to the Westpac-Melbourne Institute consumer sentiment index. The figure for August released this morning of 119.1 was up from July's 113.1
Westpac's chief economist, Bill Evans, called it a very strong result. After tumbling by 15% in the wake of three consecutive interest rate hikes in March, April and May, the index has now recovered by 17% in the past two months. "It is now back to around the level it reached at the beginning of this year and the level we saw prior to the beginning of the rate hike cycle in September last year," Evans said.
That will give considerable heart to the Labor government as it approaches the last 10 days of election campaigning. The big drop in consumer sentiment coincided with a similar decline in Labor's standing in the opinion polls.