Australian consumers cheered by reopening plans as vaccinations surge

[SYDNEY] A measure of Australian consumer sentiment bounced in early September amid hopes harsh coronavirus restrictions would soon be eased as the pace of vaccinations stepped up markedly across the states.

The Westpac-Melbourne Institute index of consumer sentiment released on Wednesday rose 2.0 per cent in September, recouping some of August's 4.4 per cent drop.

Sentiment rebounded by 5.3 per cent in New South Wales after the state government flagged a loosening of restrictions as early as mid-October, at least for those fully vaccinated.

The national index was up 13.2 per cent on September last year with the mood never getting as bleak as during the first round of the pandemic. The index reading of 106.2 showed optimists outnumbered pessimists by some margin.

"The resilience of consumer sentiment in a period when Australia's two major cities have been locked down and the economy has been contracting is truly remarkable," said Westpac chief economist Bill Evans.

"The improving vaccine situation appears to be a key factor behind these results."

Mr Evans noted confidence amongst the 57 per cent of respondents that have had at least one dose was running at 103.7, while confidence amongst the 27 per cent that were unvaccinated but willing to get the jab was up at 121.6.

That left 16 per cent of respondents who were either unwilling to be vaccinated or undecided.

The optimism showed in the survey's measures of the outlook for the economy over the next 12 months which rose 4.6 per cent, while that for the next five years gained 4.8 per cent.

The measure of family finances compared with a year ago added 1.7 per cent and that for finances over the next 12 months 2.1 per cent.

The only decline was a 2.7 per cent fall in the measure of whether it was a good time to buy a major household, though that could be partly because so many shops are shut right now.

The time to buy a dwelling measure rebounded by 8.8 per cent, recovering all of August's drop. Expectations for house prices rose by another 1.4 per cent to an eight-year peak, with NSW particularly strong.

REUTERS