The institute’s monthly index shows consumer sentiment rose just 0.2 per cent in June from 92.9 in May to 93.2.
Matthew Hassan, senior economist at Westpac, labelled the absence of a significant bounce in sentiment in June as "disappointing".
“The initial response to a Budget can sometimes be an overreaction that reverses in following months. For example, last year’s Budget showed a similar immediate reaction with the index falling seven per cent in May, with sentiment regaining more than half of that decline in June with a 4.7 per cent rise,” he said.
“The index is still in firmly pessimistic territory, however, down 6.6 per cent from its pre-Budget level in April and 15.6 per cent below its post-election high in November last year,” added Mr Hassan.
Family finances remain a focus of consumer concerns with the sub-index tracking assessment of ‘family finances compared to a year ago’ falling a further 5.4 per cent in June to a new low, the lowest reading since May 2013.
However, in more positive news, consumers appear to be becoming less fearful of rising unemployment.
The Index of Unemployment Expectations, which tracks expectations for unemployment over the next year, registered a marginal decline, falling 1.1 per cent from 158.3 to 156.5
“That is a significant improvement on the peak in unemployment fears back in March when the index hit 164.4, but still significantly ‘worse’ than the 144.7 reading in November. Job loss concerns remain elevated,” said Mr Hassan.