Westpac (ASX:WBC, NZE:WBC) sees Australia's second-quarter retail sales data as marginally encouraging, as the 0.3% rise is still low compared to the 0.6% gain in the second half of 2024, according to the bank's report on Friday.

The bank added that the 1.2% month-on-month surge in retail sales was a "bit better" than its expected flat result, but it believes that some of the rise may just be due to end-of-financial-year sales and the upturn may not be durable.

Westpac believes that the data is a "little more hopeful," but it is still uncertain whether the improvement reflects temporary factors like sales-driven spending or a genuine and lasting recovery in consumer activity.

The bank said the second-quarter national accounts in September and early third-quarter monthly data will be crucial in determining whether the June bounce reflects lasting momentum or just seasonal noise.