Australia consumer sentiment remains cautiously negative

The Westpac-Melbourne Institute Consumer Sentiment Index in Australia edged up slightly by 0.1% to 92.2, reflecting minimal change in consumer confidence compared to January.

Despite the slight uptick, consumers remain cautious due to financial strains and ongoing cost-of-living pressures. There are burgeoning signs of optimism for the future.

The sub-index for 'family finances compared to a year ago' declined by 3.4% in February to 75.1, though it remains 18.9% above the low experienced last May.

Conversely, the 'finances in the next 12 months' sub-index rose by 0.6% to 105, indicating more optimists than pessimists are looking forward. Significantly, the most notable improvement has been among consumers with a mortgage, spurred by favourable inflation data and anticipated interest rate reductions.

This positive outlook suggests an easing of financial pressures for mortgage holders.