The closely watched Westpac-Melbourne Institute Consumer Sentiment Index surged by a whopping 11.9% in October in a sign that Australians have given the budget two thumbs up.

Westpac’s Chief Economist Bill Evans says three key factors are behind the jump in consumer sentiment in what he calls “an extraordinary result,”

“The budget is the most prominent (factor), the other ones are the success the states have had in containing the virus, and of course the expectation that the Reserve Bank is going to cut rates next month,” Mr Evans tells Brooke Corte.

Over the past ten years, Westpac has asked Australians whether the Budget would ‘improve their finances’ and typically, more people say ‘no’ than ‘yes’.

However, the response this year bucked this trend.

“We were getting used to the idea that people are pretty sceptical about budgets and along came this one where 9.5% positive balance suggested that things would affect them positively,

“I think the budget was really key factor in this strong lift,”

Despite the positive reception received by the budget, Mr Evans says the government still has room to splash even more cash around as a function of new spending to GDP.

“I think more could’ve been done in the budget, to be honest,”

Click play to hear the full interview: