Investing.com– Australian consumer sentiment improved further in November, a private survey showed on Tuesday, amid growing conviction that local interest rates will not rise, while recent signs of easing inflation also helped.
The rose 5.3% to 94.6 in early-November, rising further away from near record lows and extending gains from last month.
But Westpac noted that the results of the U.S. presidential election- where Donald Trump won a second term- had spurred some uncertainty among Australian consumers over the economic outlook. Trump is expected to enact more protectionist policies, potentially disrupting global trade and pressuring China, which is a key trading partner for Australia.
Sentiment had somewhat soured after Trump’s victory, although it improved towards the end of the survey period.
“The consumer recovery gained more traction through October-November but the survey detail suggests some of this momentum has been checked by renewed uncertainty following the US election,” Matthew Hassan, Head of Australian Macro-Forecasting at Westpac wrote in a note.
Still, overall sentiment remained upbeat after the Reserve Bank of Australia kept interest rates unchanged last week, while inflation data for the third quarter also showed some easing in price pressures.
Australian consumer sentiment was battered over the past two years as local interest rates rose and as cost of living pressures mounted.
While an extended hold by the RBA and some easing inflation have aided sentiment in recent months, the Westpac index still remained close to historical lows.
