SYDNEY, Feb 13 (Reuters) - A measure of Australian consumer confidence recovered sharply in February after a dismal start to the year, as improved optimism on the economy and family finances suggested some resilience to gloomy media coverage on falling home prices.
Wednesday’s survey showed the Melbourne Institute and Westpac Bank index of consumer sentiment jumped 4.3 percent in February, from January when it slid 4.7 percent.
The index, compiled from a survey of 1,200 people, was up 1 percent from a year earlier at 103.8, meaning optimists now outnumbered pessimists.
“Sentiment has recovered after a shaky start to the year,” said Westpac senior economist Matthew Hassan. “The February lift takes the Index back into ‘cautiously optimistic’ territory.”
The rebound in confidence was something of a surprise given media coverage of the Reserve Bank of Australia (RBA) last week after it cut forecasts for economic growth, citing weakness in consumption and sliding home prices.
Despite the downgrades, the survey’s measure of economic conditions for the next 12 months rose 7.0 percent, while the measure for the next five years climbed 3.8 percent.
The index of family finances compared to a year ago rose 5.6 percent and the outlook for the next 12 months firmed 5.5 percent.
“The continued house price correction, concentrated in Sydney and Melbourne, is impacting consumer expectations for house prices but so far appears to be having only limited spillover effects on wider confidence,” said Hassan.
However, the survey’s measure of whether it was a good time to buy a major household item edged up only 0.3 percent, suggesting conditions were still tough in the retail industry. (Reporting by Wayne Cole Editing by Shri Navaratnam)
Our Standards: The Thomson Reuters Trust Principles.