A widely-watched consumer sentiment index has remained negative for the eighth straight month.

The long running Westpac - Melbourne Institute Index of Consumer Sentiment rose 0.9 per cent this month, but remains pegged well below the 100-point level that indicates when optimists equal pessimists.

At 94.8 in October, the reading is close to the average negative reading over the last eight months, but well off the optimism seen before that, when the index only had one negative reading in 16 months.

"While the index seems to be stuck in a pessimistic range there is no sign, at this stage, of ongoing deterioration," Westpac's chief economist Bill Evans noted in the report.

He pointed to conflicting factors evening out the monthly result.

On the one hand, consumers would have been rattled by a steep fall in the share market and Australian dollar, but on the other it appears many households were pleased that key budget savings measures looked set to fail in the Senate.

"Possibly in response to more comfort around the budget initiatives we saw improvements in respondents' assessments of their own finances," Mr Evans added.

"The component 'family finances vs a year ago' increased by 4.4 per cent, while 'family finances next 12 months' improved by 1.2 per cent."

Another area of improvement was in job prospects, with unemployment expectations falling by 3.9 per cent despite recent volatility in official labour force statistics.

Westpac said this is the lowest reading since November 2013, with the index now nearly 10 per cent below the peak of unemployment fears in March.