Consumer confidence has picked up, due to falling petrol prices and mortgage rates, boosting household's spending power.
The Westpac-McDermott Miller consumer confidence index rose 2.5 points to 117.4 in the March quarter, compared with the previous three months.
There was a modest decline in the reported spending on entertainment and eating out, though this remains above average.
A reading above 100 indicates more optimists than pessimists.
Senior economist at Westpac Felix Dulbruck said it comes as no surprise, and indicated respondents expected to be better off in the coming year.
"It is very much in keeping with the stronger retail data we have seen of late, which suggests that the stronger data has some legs to it."
Mr Dulbruck said there was a lift in confidence in rural areas, which was surprising given the drought and low dairy payout.
"The reason might simply be that global dairy prices rose quite sharply in recent dairy auctions," he said.
