Consumers have shrugged off a veil of gloom, although supporters of the coalition aren't too happy about leadership shenanigans in Canberra.
Consumer confidence has leapt by eight per cent, buoyed by last week's interest rate cut and the recent sharp drop in petrol prices.
The Westpac-Melbourne Institute consumer sentiment index jumped above the 100 mark, indicating there are more optimists than pessimists for the first time in a year.
However, Westpac chief economist Bill Evans says the unrest surrounding the Liberal leadership triggered a sharp fall in confidence among coalition voters.
"But the confidence of ALP supporters, third-party voters and the undecided was boosted sufficiently to deliver the overall positive result," he said.
This renewed confidence will be put to the test when the latest labour force figures are released on Thursday.
Economists expect the January figures will show a rise in the unemployment rate from 6.1 per cent to 6.2 per cent.
Other data on Thursday indicated that employment growth is unlikely to be too flash in coming months.
The Department of Employment's leading indicator fell for a fifth consecutive month in February, and has now fallen for 11 of the past 13 months.
The department says while six consecutive moves in one direction are needed to confirm a turning point in jobs growth, it is possible employment might fall below its long-term trend in coming months.
Australian National Retailers Association chief Anna McPhee was not getting too carried away with the apparent boost in confidence.
It remained to be seen whether more needed to be done before improvements in retail activity were noticed, she said.
But Small Business Minister Bruce Billson said people should ignore Labor's talk of "doom and gloom".
"Instead, I encourage the hard-working women and men of small business to be buoyed as I am by these results," he said.
Other figures showed the number of home loans granted to owner-occupiers in December increased by a stronger-than-expected 2.7 per cent to 53,920, the largest monthly figure since October 2009.
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