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A friendlier Federal Budget and the Reserve Bank’s latest interest rate cut have helped boost consumer confidence levels.

The Westpac-Melbourne Institute Index of Consumer Sentiment rose 6.4 per cent from 96.2 points in April to 102.4 points in May. The figure indicates there are just slightly more optimists about the economy than pessimists.

Australian National Retail Association (ANRA) CEO Anna McPhee said the confidence boost was predicted on Budget night last week.

“Today’s sentiment reading showed consumers are feeling more optimistic than they have for quite some time and this is likely attributed to consumers feeling relatively positive about last week’s Federal Budget and the RBA’s decision to cut the official cash rate in May and the decision by the major banks to pass an interest rate cut onto customers,” she said.

“Treasurer Hockey on Budget night urged all Australians to get out there and have a go. With the rise in consumer confidence recorded in May, it might happen.

“The retail sector is encouraged by the bounce in sentiment after experiencing slowed retail activity and wavering confidence for some time after last year’s Budget.”
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