Spending on the increase finds CBA
Despite a generally gloomy global economic outlook, Australians have kept spending with a vengeance, according to the latest figures released by the Commonwealth Bank.
Economy wide spending rose by 1.9 per cent in the January period, marking the fifth month of increasing underlying spending.
According to the Bank’s Business Sales Indicator (BSA), which tracks the value of credit and debit card transactions, spending grew by 0.8 per cent in trend terms in January.
Adam Bennett, Executive General Manager, Local Business Banking, Commonwealth Bank, believes the latest results provide businesses with a more positive outlook for the year ahead.
“While Christmas spending did not have the impact many businesses had hoped for, the results of January spending offered some positive news. The results show that although spending patterns remain erratic, consumers are still willing to spend and confidence is heading in the right direction," Mr Bennett said.
“The good news is we also saw solid annual increases in sectors such as amusement and entertainment and retail, which heavily rely on the busy festive period.
“As businesses look to the year ahead, it is important to continue to focus on efficiency and have plans in place to navigate future fluctuations in spending habits and consumer sentiment,” said Mr Bennett.
Craig James, Chief Economist of the Bank’s broking subsidiary CommSec and author of the BSI, believes the latest results demonstrate that consumers are making solid steps in the right direction.
“The lift in spending in January coincided with post-Christmas sales, suggesting that consumers are more inclined to spend when goods or services are discounted. However, we have seen positive indicators for some time now, with the underlying trend pattern ticking upward for the past five months.
“Hopefully as the international picture begins to brighten we will see further gains in spending in coming months,” said Mr James.