Consumer confidence has rebounded in June to end in positive territory, according to the latest Westpac-Melbourne Institute Index of Consumer Sentiment.

The index bounced by 4.7 per cent in the June period from 97.6 points to 102.2, after confidence slackened in May.

“After falling sharply through April and May, consumer sentiment recovered some lost ground in June. The 4.7% rise takes the level of the index back over the 100 level indicating that optimists now outnumber pessimists again although the margin is slim. Consumer confidence remains 8.2% lower than its peak early in the year,” Westpac Senior Economist Matthew Hassan said.

“It appears that some of the factors behind the sharp drop in sentiment in May were temporary. In particular, concerns stemming from the Federal Budget may have eased somewhat in June.”

However, a slide in the Australian dollar, ongoing pessimism around the Australian economy and weak first quarter national accounts may yet see an entrenched fall in sentiment, according to the report.

The most positive aspect of the survey continues to be around views on ‘time to buy’. The sub-index tracking views on "whether now is a good time to buy a major household item" posted a modest 3.7% gain in the June month but is the only sub-index at high overall levels above historical averages. Separate indexes tracking views on ‘time to buy a dwelling’ and ‘time to buy a car’ are even stronger with both largely unchanged at highs 20pts and 16pts above their respective long term historical averages.