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The Westpac–Melbourne Institute Consumer Sentiment Index rose slightly by 0.6% to 93.1 in July from 92.6 in June. While modest, the lift reflects cautious optimism, with sentiment improving despite disappointment over the Reserve Bank of Australia’s decision to hold rates steady.
More consumers now expect interest rates to fall in the near term. The Westpac–Melbourne Institute Mortgage Rate Expectations Index dropped 1.7% in July to 83.1, its lowest level in 13 years.
Views on the economy were mixed. The ‘economic outlook, next 12 months’ sub-index rose 1.8% to 94.1, while the ‘economic outlook, next 5 years’ fell 2.8% to 93.4. Both remain slightly above long-run averages but have lacked sustained momentum this year. Ongoing global uncertainty, particularly around tariffs, is weighing more heavily on longer-term confidence, which has fallen nearly 8% since March.
Consumers aren’t overly negative, but many remain unsure which way the economy is heading.
#consumersentiment #smallbusiness #interestrates
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