Household spending in Australia remained flat at 0.0% in August, according to seasonally adjusted data from ABS.
This follows declines of 0.5% in July and 0.1% in June, showing a trend of slowing consumer activity.
Robert Ewing (pictured above), head of business statistics at ABS, noted the sluggish start to the financial year despite the recent introduction of the federal government’s Stage 3 tax cuts on July 1.
“Growth in household spending has stalled at the start of the financial year,” Ewing said.
In terms of spending categories, there was a modest 0.4% rise in spending on services, marking the second consecutive month of growth in this area.
Ewing attributed this increase to higher spending on air travel, hotel stays, and dining out.
However, this uptick was offset by a 0.3% decline in spending on goods, particularly in areas like new vehicle purchases and automotive fuel, dragging overall household spending down.
On a year-on-year basis, household spending showed varied performance across different states and territories, ABS reported.
Western Australia led with a 3.9% increase, followed by Queensland at 2.7%, and the Northern Territory with a 1.9% rise.
In contrast, Victoria and Tasmania saw a 0.3% decline in spending compared to the same time last year, highlighting regional disparities in consumer behavior.
August marked the second month of consecutive declines in trend terms, with household spending falling by 0.1%.
This downward trajectory reflects broader economic uncertainty, as consumers remain cautious despite policy measures like tax cuts aimed at boosting disposable income.
With spending on goods continuing to decline, the near-term outlook for household consumption remains uncertain.
Read the ABS media release and Monthly Household Spending Indicator, August 2024 for more information.
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
