Australians have amassed $115 billion in total savings as a buffer against the pandemic recession, in a sign that economic recovery is unlikely to be derailed by any future reduction in government income support.

APRA figures show household deposits surged to $1.09 trillion by the end of September – an increase of $115 billion in 12 months and a $99.5 billion increase on deposit levels in February, before the pandemic took hold.

NAB director of market economics Tapas Strickland says that, just as the tens of billions in emergency support helped soften the virus recession, the savings amassed recently will help households navigate any drop-off in income payments over coming months. There is mounting optimism the economy is recovering after a 7% contraction in the June Quarter. RBA deputy governor Guy Debelle said last week he expected the economy to have grown in the September Quarter, which technically would end of the pandemic recession.

Surveys show that, outside Victoria, consumer confidence has staged a dramatic recovery to sit at pre-pandemic levels.