Spending on household goods has fallen by 2.3 per cent in September month-on-month in seasonally adjusted terms, driven by declines on discount department stores and men’s clothing stores.
This is according to the monthly CommBank Household Spending Insights (HSI), which added that the fall in the two above categories followed a surge in August due to Father’s Day spending.
The monthly 2.3 per cent fall for household goods overall in September followed a 4.3 per cent lift in August.
Spending overall across all business categories was reportedly down, driven by slumps in six of the twelve spending categories. Hospitality led the charge with a 2.8 per cent fall, followed by transport (down 2.5 per cent) and household goods coming in third.
Recreation helped offset these declines, rising 1.5 per cent in September, largely driven by an 18 per cent surge in ticketing services as eager sports fans snapped up tickets to the AFL and NRL grand finals.
Spending on education and insurance also rose, each up by 0.7 per cent. Utilities spending, unexpectedly up 1.3 per cent, reflected the impact of rising local council and strata management fees, even as electricity costs declined off the back of government rebates.
Looking at year-on-year spending, the transport category has plummeted 15 per cent in the past 12 months, and was the only category to record declines both monthly and annually.
Household goods reported a modest lift in spending, up 0.8 per cent, dropping from 5 per cent recorded in August year-on-year. This added to an overall lift in spending of 2.1 per cent, down from 3.7 per cent in August.
The largest lifts in spending across household goods occurred in online marketplaces, furniture stores, discount and variety stores, cosmetic and beauty stores and women’s clothing stores.
This was partly offset by reduced spending on men’s and women’s clothing stores, discount department stores, tobacconists, bathroom retailers and newsagencies.
Renters have witnessed the weakest spending in the year to September, down 1.1 per cent for the year, compared to those with a mortgage (up 1.2 per cent) and those who own their home outright (up 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,” Halmarick said. “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.”
Halmarick said 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.