The new prime minister is keeping consumers happy, but the "Turnbull effect" isn't enough to keep businesses upbeat.
New surveys published on Tuesday show that while consumer confidence is on the rise, largely thanks to Malcolm Turnbull's elevation to the nation's top job, businesses are downbeat about future sales, profits, and employment.
The latest ANZ/Roy Morgan weekly consumer confidence index rose 1.6 per cent last week, after managing just a 0.1 per cent lift the previous week.
ANZ chief economist Warren Hogan said Mr Turnbull had made people feel more optimistic about the economy, with confidence levels above the long-run average for the past few weeks.
"The four-week moving average is now at its highest level since February 2014," he said.
The lift in confidence comes despite a slowdown in house price growth and moves by the big four banks to increase home loan borrowing costs.
Mr Hogan said consumers' view of conditions in the next 12 months rose 5.1 per cent last week, with the result sitting 25 per cent higher than before the change in prime minister in late September.
People were also more positive about their finances compared to a year ago, reversing the falls seen in the previous two weeks that were driven by the banks' rate hikes.
But while consumers are feeling positive, businesses expect sales, prices, profit, investment and employment to all decline in the three months to March next year, Dun and Bradstreet's latest business expectations survey has found.
It is the first time in about two years that all five measures posted a fall in confidence.
"The recent political changes in Canberra have not been enough to see the business sector maintain its previously quite upbeat expectations for the economy," economics adviser to Dun & Bradstreet Stephen Koukoulas said.
"It is a sharp reversal from the generally upbeat tone to business expectations that prevailed throughout most of 2015."
Mr Hogan said households expect the Turnbull government to deliver a credible platform to improve economic growth.
"This will be critical in the face of a slowing housing market," he said.
JP Morgan economist Tom Kennedy said a big drag on consumer sentiment during the past year had come from the political realm, but the recent change in leadership had triggered a rise during the past six weeks.
Recent speculation about a rate cut by the Reserve Bank may also be helping consumers to feel more upbeat.
"That would be viewed positively by households... (it would) help them with mortgage repayments," he said
