FX.co ★ Australia Consumer Sentiment Hits 9-Month High

Australia’s Westpac–Melbourne Institute Consumer Sentiment Index rose 6.0% to 88.9 in August 2026, accelerating from a 4.1% gain in July and marking the sharpest monthly increase since November 2025. The improvement was driven largely by reduced anxiety among mortgage holders about the prospect of further interest rate rises.

Household financial perceptions strengthened notably. Assessments of finances compared with a year ago jumped 12.6% to 80.0, while expectations for finances over the next 12 months edged up 1.8% to 98.2. Broader economic views also improved: the one-year economic outlook climbed 5.8% to 82.8 and the five-year outlook advanced 3.2% to 89.8.

The sub-index tracking whether it is a good time to buy major household items increased 8.1% to 93.8, indicating a modest lift in willingness to spend on big-ticket goods. Meanwhile, the index of unemployment expectations rose 4.4% to 135.7, signalling that more consumers anticipate higher joblessness ahead.

Westpac economist Matthew Hassan noted that the Reserve Bank now has room to keep the cash rate on hold after three increases earlier this year, while it evaluates the effects of tighter monetary policy and monitors whether underlying inflation has reached its peak.