The CommBank Household Spending Insights (HSI) Index recorded another month of gains in August, extending six consecutive months of better growth as household spending returns to a more stable footing.
The CommBank HSI Index rose 0.3 per cent in the month, following a 0.7 per cent lift in July and 0.5 per cent rises in both May and June.
Nine of the 12 categories rose in August, led by Utilities (+2.9 per cent), Communications and Digital (+1.0 per cent), Recreation (+0.6 per cent), Education (+0.6 per cent) and Household Services (+0.5 per cent). Modest increases were also seen in Motor vehicles, Health, Transport and Hospitality.
Insurance (-0.1 per cent) posted its first monthly fall since January 2024, while Household Goods (-0.3 per cent) and Food & Beverage Goods (-0.1 per cent) edged lower following strong mid-year activity.
“We’ve now seen six months of solid growth, reinforcing our view that a consumer recovery is underway after a series of false starts last year and early into 2025. The combination of growing incomes, a solid labour market and lower interest rates is helping improve household sentiment as consumers are able to both spend and save again,” Head of Australian Economics Belinda Allen said.
“Utilities was the top spending category in August, that uptick is largely driven by general volatility in energy bill payments, as well as the timing of energy price rebates. More interesting is the strong increase in spending on Communications and Digital, which reflects the longer-running, structural shift in consumers favouring spending on experiences rather than goods.
“In particular, August’s spending increase is propelled by the surging popularity of online services like gaming and streaming, as well as the impact of weather. The wettest August in 27 years in Sydney likely had a hand in higher spending on food delivery services and lower spending in cafes during the month.”
On an annual basis, household spending is now up 5 per cent, with the strongest gains seen in Communications and Digital (+10.6 per cent), Utilities (+9.4 per cent), Recreation (+8.3 per cent) and Hospitality (+7.7 per cent), while Transport remains in negative territory (-1.6 per cent) due to petrol price falls.
The broader economic backdrop remains supportive. The RBA has cut the cash rate three times in 2025 in a cautious easing cycle, with moderating inflation and last year’s tax cuts providing further support for households.
Recent GDP data showed the Australian economy picking up momentum more than expected, underpinned by a stronger-than-anticipated consumer sector.
Ms Allen said CommBank continues to expect only one further rate cut from the Reserve Bank of Australia this cycle.
“With the broader economy showing signs of resilience and the consumer returning to a more solid footing, we don’t see the need for the RBA to go much further. We continue to expect just one more cut in November, but no change at the RBA’s September meeting.
“As we look to 2026, we expect to see both consumer spending and the broader economy continue to improve back to around the rate of potential economic growth. "
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.