Help us improve our website by completing a quick survey. Start survey now

Commonwealth Bank Business Sales Indicator shows consumer spending continues to rise

18 December 2009: Australian consumer spend continues to rise in November, following strong months of growth, according to the Commonwealth Bank Business Sales Indicator(i) released today.

The Commonwealth Bank Business Sales Indicator tracks the value of credit and debit card transactions processed through Commonwealth Bank merchant facilities across 20 industry sectors throughout Australia.

According to Symon Brewis-Weston, Head of Commonwealth Bank Local Business Banking, the Business Sales Indicator provides Australian consumers and business owners with a unique insight into household and business spend.

“For November, the Commonwealth Bank Business Sales Indicator showed consumer spend increased by 0.6 per cent in trend terms, up from 0.5 per cent in October.

“Since bottoming in September, the Business Sales Indicator has now risen for two consecutive months. Compared to one year ago, the Indicator is up 6.8 per cent – the fastest growth in 22 months,” he said.

Craig James, Chief Equities Economist at the Commonwealth Bank said: “The latest result is clearly a sign that consumers and business owners are cautiously celebrating the improving economic environment.

“The sustained pickup in consumer and business sentiment is starting to filter through to the overall level of spending in the economy.

“Interestingly, the latest rise in the Business Sales Indicator comes despite an economic landscape where fiscal stimulus has been fading and interest rate hikes have featured heavily,” Mr James said.

The value of spending Transactions fell in just three of 20 industries during November. The weakest sector was Business Services (down 0.7 per cent), followed by Hotels and Motels (down 0.3 per cent) and Repair Services (down 0.1 per cent). Sales in the Business Services sector decreased in trend terms for seven consecutive months, while Hotels and Motels have eased for four straight months.

However, the strongest industry sectors in November in trend terms were Automobile and Vehicles (up 3.4 per cent) followed by Retail Stores (up 1.3 per cent).

“Automotives increased which highlights the impact of the Government’s Depreciation Allowance ending on 31 December which has brought demand forward,” Mr Brewis-Weston adds.

For annual terms sectors which recorded strong growth includes; Retail Stores (up 15.3 per cent), Personal Service Providers (up13.1 per cent), and Government Services (up 5.9 per cent). The main sector where transaction growth has been consistently weak is Business Services, down 3.4 per cent on a year ago.

From a state perspective, a strong rise in NSW indicates that a broader recovery in the nation’s most populated state is underway.

The Commonwealth Bank Business Sales Indicator also revealed across the states, the fastest sales growth during November occurred in Tasmania – up 1.2 per cent – followed by South Australia (up 0.9 per cent), Victoria (up 0.4 per cent), and Queensland (up 0.3 per cent).  At the other end of the scale, spending was weakest in Western Australia (down 0.5 per cent).

Mr Brewis-Weston highlighted the importance of the Indicator’s industry and state insights and the important role this type of knowledge will play in the management and operation of Australian businesses.

“The Indicator plays a vital role for businesses across the country. It’s insight into spending patterns by state and industry will prove invaluable for those seeking to improve their sales and see more effective business planning and management,” he said.   

“The November Business Sales Indicator shows why business confidence has continued to rise in the past two months and supports the notion that stronger economic growth is starting to take shape,” he said.

The Commonwealth Bank Business Sales Indicator is reported on a monthly basis and available to the public on the Bank’s website and to media through media release on or around the 20th day of each month.

ENDS

For more information, please contact:

Nichole Ismay
Commonwealth Bank
Phone: (02) 9378 5965
Email: nichole.ismay@cba.com.au 


Notes to editors

i. About the Commonwealth Bank Business Sales Indicator

The Commonwealth Bank Business Sales Indicator is calculated by tracking credit and debit card transactions processed through Commonwealth Bank merchant facilities throughout Australia (approximately 30 – 40 per cent of market).

The Commonwealth Bank Spending Business Sales Indicator has been devised to provide a monthly assessment of spending trends in the Australian economy. Currently, the main monthly indicator of spending in the economy is the Australian Bureau of Statistics’ (ABS) Retail Trade release. The main quarterly indicator of spending in the economy is the ABS Household Final Consumption Expenditure (HFCE). A quarterly measure of the Commonwealth Bank Business Sales Indicator has closely tracked the ABS household consumption series over the past three years, highlighting the value of the Commonwealth Bank Business Sales Indicator to track changes in spending across the economy. The Business Sales Indicator is available monthly; broader household consumption figures are only available from the ABS on a quarterly basis.

The Commonwealth Bank Business Sales Indicator includes industry sectors based on international Merchant Category Code (MCC) categories.

Loading…