Australian consumer confidence bubbled up in January, making the strongest start to a calendar year since 2010, and easing concerns that a slowdown in spending could stall the economy in 2018.
The Westpac-Melbourne Institute Index of Consumer Sentiment rose 1.8% to 105.1 in January, its highest level since late 2013.
The improved mood of consumers comes as retail sales have revived strongly in recent months from an alarming soft patch in the third quarter.
Still, there are questions over the sustainability of the recovery with aggressive discounting and sales of the new iPhone boosting retail sales, while some economists argue consumers are upbeat due to Australia's recent drubbing of England in an Ashes cricket test series.
It all makes for an interesting start to 2018 as markets await December employment data on Thursday, which is expected to show more solid jobs growth, extending a stellar 2017 for employment creation.
The Reserve Bank of Australia warned in early December of "significant risk" surrounding the consumer. The central bank will hold its first policy meeting for the year in early February, with interest rates on hold since August 2016.
Westpac senior economist, Matthew Hassan, said sentiment has continued to recover, bolstered by a less threatening outlook for interest rates and improving confidence around the economy and jobs.
Mr. Haslem added the degree to which spending improves still looks likely to be constrained with the survey details suggesting family finances are still under pressure.
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(END) Dow Jones Newswires
January 16, 2018 19:29 ET (00:29 GMT)