Sydney, Aug 14 (IANS) Australia's consumer confidence has responded well to the recent rate cut by the Reserve Bank of Australia, according to a survey released Wednesday.
Consumer sentiment increased by 3.5 percent to 105.7 in August from 102.1 in July, reported Xinhua citing a survey by the Westpac Banking Corp and Melbourne Institute.
Westpac chief economist Bill Evans said the result was the highest since March.
"However, it is still seven percent below the average print in 2010 when households had become quite optimistic that the potential fallout from the global financial crisis had passed," he said in a statement.
Evans said several important forces were operating over the month to impact the consumer sentiment.
"Most important were the decision by the reserve bank to cut its overnight cash rate by 0.25 percent and the full pass through of this cut to mortgage rates; the announcement of the election date; the government's economic statement which revealed a further deterioration in the fiscal position; and the consolidation of the Australian dollar at around 15 percent below its recent peaks back in April," he said.
Evans said the result indicates that the rate cut was likely to have had a positive impact on sentiment.
"Further evidence of the positive response to the rate cut can be found in the response of those folks with a mortgage, with their confidence lifting by 7.4 percent.
"The interest rate cut appears to have boosted confidence around family finances," Evans added.