Australian consumer confidence high.

Higher wages and the lowest rate of unemployment since 1974 are keeping Australian consumer confidence at near record heights. Two confidence surveys, released within one day of each other, both reached the same conclusion.

The Westpac Banking Corporation consumer survey conducted in partnership with the Melbourne Institute resulted in an index score of 120.8. The study format is built around the idea that scores over 100 index points mean there are more optimists than pessimists. Study results were released on July 11, 2007 and reported widely. The information in this brief review came from Bloomberg News.

On July 10, 2007, a press release from the market research firm Roy Morgan International (Melbourne) said that its consumer confidence index rose 4.5 points from June 2007 for a July 2007 reading of 126.8 points--the highest since a 132 point score in February 2005.

The Westpac-Melbourne Institute survey actually fell from June 2007 0.6 points, but there was no mistaking the overall positive tone of respondents' views. The Bloomberg story commented, "A pickup in consumer spending may stoke an economy that expanded at the fastest pace in more than three years in the first quarter."

Some of the strength in the confidence scores certainly came from the fact that Australia's central bank left interest rates unchanged after its most recent monetary policy meeting. Bloomberg reported, too, that prices for gasoline fell. Other good news came from a survey by the National Australia Bank showing that business confidence was at a two year high. Increased commodity purchases by China stimulated hiring by Australia's mining companies.

Bloomberg said that the Westpac-Melbourne Institute survey's index of the state of family finances rose a slight 0.1 percent. Even better for consumer spending prospects, "An index measuring whether now is a good time to buy a major household item, such as a television or appliance, gained 3.2 percent."

Consumers told Roy Morgan that they were expecting good economic conditions in Australia by a margin of 48 percent over 17 percent who were pessimistic.

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