Australia's retail sales came in better than expected in September, data showed on Tuesday, a sign that consumers are responding to more than a year of record-low interest rates.
Retail sales rose 1.2 percent from the month before, much better than a Reuters consensus for a 0.3 percent gain.
The increase was across the board, with department-store, household goods and cafe-and-restaurant sales all recording big increases. Department-store sales added 1.3 percent, while sales of household good surged 4.1 percent. Cafe-and-restaurant sales rose 2.0 percent.
Read MoreAustralia to become top LNG exporter by 2018
Trade data released at the same time showed imports rose a seasonally-adjusted 6 percent from August, while exports climbed one percent. This brings September trade deficit to 2.26 billion Australian dollars, compared with expectations of a 1.95 billion deficit.
Meanwhile, revised employment figures showed the economy lost 23,700 jobs in the month, less than the initial estimate of 29,700.
Read MoreAustralia's economy: from mining to building
"It's hard to pinpoint what exactly drove the 1.2 percent [rise in retail sales] but you also saw good imports as well, so clearly, retail was stocking ahead of Christmas," said Matthew Circosta, economist at Moody's Analytics, adding that the momentum will continue in the lead up to Christmas.
"Overall, consumption is growing at a moderate trend. On the upside, you have seen some gains in stock markets and house prices so there are some wealth effects playing out as well so that's supporting retail," he added.