There has been a notable decline in spending on Transport, impacted by the falling price of petrol, down approximately 15 per cent in the past 12 months. Transport was the only category to record declines both monthly (-2.5 per cent) and annually (-7.2 per cent).
On an annual basis, there was a significant slowdown in the pace of spending growth in the year to September to just to 2.1 per cent, down from 3.7 per cent in August.
Renters have witnessed the weakest spending in the year to September, down 1.1 per cent for the year, compared to though with a mortgage (+1.2 per cent) and those who own their home outright (+2.3 per cent).
CBA Chief Economist Stephen Halmarick said HSI data suggested income tax cuts had not led to a material rise in consumer spending.
“The spending slowdown in September was expected after an early Father’s Day led to consumers splashing out on household goods and hospitality for Dad. Although we saw a rise in Recreation spending associated with the AFL and NRL Grand Finals, consumer spending overall remains subdued, now growing at just over two per cent for the year.”
“It’s important to note that the only other spending categories to rise in September were all essentials, indicating that increased take-home pay from tax cuts is largely being used to pay down debt and on staples, not spending on discretionary items. This trend is reflected in the year to September, supporting our view that softer economic data, coupled with a further deceleration in inflation will see the RBA cut interest rates in December 2024.”
The CommBank HSI Index tracks month-on-month data at a macro level and is based on de-identified payments data from approximately 7 million CBA customers, comprising roughly 30 per cent of all Australian consumer transactions.
