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Confidence hits highest levels since pandemic struck, survey finds

Business

Australians are growing in confidence as the economy starts to recover from the coronavirus pandemic fallout, a signal household spending may pick up as long as employment grows.

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The ANZ-Roy Morgan consumer confidence index grew by a further 1.6 per cent to 99.7 points in the past week, the highest level since March.

The index has now risen for eight straight weeks and stands just below the neutral level of 100 which separates pessimists and optimists.

ANZ head of Australian economics David Plank said falling COVID-19 base numbers and hopes of a further easing in restrictions have helped to keep confidence on an upward trend.

He said sub-indices suggest people remain cautious about the current economic outlook.

“This may constrain spending in the near-term,” Plank said on Tuesday.

“Confidence in future economic and financial conditions is much more positive, however, holding out the prospect of a recovery in spending if the labour market holds up.”

Treasury secretary Steven Kennedy appeared before a hearing on Monday, telling senators the recovery from the biggest economic contraction on record is under way.

He believes the Morrison government’s budget response to the pandemic should have a greater impact on the economy in a low-interest-rate environment.

The hearing comes against the backdrop of speculation the Reserve Bank of Australia could ease interest rates even further as soon as its board meeting on November 3 – a gathering Kennedy will attend.

RBA deputy governor Guy Debelle will appear before a Senate estimates hearing on Tuesday.

-AAP

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