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CommBank weekly card data shows slowdown in household spending

CommBank weekly card data shows slowdown in household spending

The following article has been developed by the Global Economic & Markets Research team.

Spending wasn’t as strong as the previous week. The slowdown was broad-based, across goods, services, online, in-store, and in all states except Tasmania.

  • CommBank household credit and debit card spend data for the week ending 31 July shows total spending on goods and services was up just 3% from a year ago, compared with 10% year-on-year growth in the previous week
  • The Stage 3 lockdown in Metropolitan Melbourne is having a clear impact on the state’s numbers, with spending down 6% from last year. We expect the move to Stage 4 restrictions to have a profound impact on the state’s consumer spending
  • Spending in NSW on eating and drinking out is slowing as coronavirus cases rise

Household spending on goods is up 20% from the same week a year ago, while household spending on services is 12% below the same period last year. 

Total household card spending on goods and services is 3% higher than a year ago. 

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Spending by channel

Both online and in-store spending softened in the week that ended 31 July. Online spending has been heavily impacted by swings in education spending in Victoria due to changes in semester dates. With Victoria entering Stage 4 lockdown on 2 August we expect in-store spending there to deteriorate further.

In total online spending is up 6% from the same week a year ago and in-store spending is up 3%.

Spending by state

The Stage 3 lockdowns in Melbourne caused card spending in Victoria to fall back into negative territory, to be 6% lower than a year ago.

Spending in Queensland also dropped sharply, mainly due to education and spending on other services.

While Tasmania continues to outperform, with spending up 19% from the same period last year, spending in the ACT weakened further to be 10% down from last year. As in Queensland, the weakness was driven by spending on education and other services.

Spending by category

Spending on food goods (primarily at supermarkets and grocery stores) remains high, up 25% from the same period last year. Spending on food services (cafes, restaurants, takeaway, etc) is just 3% higher than the same time last year. Total spending on food goods and services is up 18% from the same period a year ago. 

Spending on alcohol services (drinking at hotels, pubs and clubs) is running 13% below last year’s levels while spending on alcohol goods (bottle shops) remains elevated, running 34% above the same period last year. Total spending on alcohol goods and services is 15% higher than the same time last year.

Household furnishings and equipment spending is easing slightly but remains strong at 38% above last year’s levels.

Spending on clothing and footwear is 4% above last year’s levels, while spending on personal care (hairdressers, barbers and beauty salons) continues to soften, driven by Victoria’s lockdown, and is now just 1% higher than the same week a year ago. 

Spending on transport has also eased and is 9% below last year’s levels.

Spending on recreation (including accommodation, air travel and travel services) fell in all states over the past week as restrictions remain in place, as well as the closure of borders restricting interstate and overseas tourists. Queensland has since closed its borders to the greater Sydney area. Spending on recreation is now 10% lower than the same period a year ago.

Why is this information helpful?

CommBank weekly credit and debit card spend data gives you an up-to-date picture of what people are spending their money on and how this is changing as the coronavirus continues to impact our lives and the economy. 

We will be providing further updates to help you understand the impact that the virus is having on businesses and the broader economy.

Note: Weekly CBA household credit & debit card spend data is derived from transaction authorisations to give a near real-time view. This means that cancelled authorisations, refunds, reversals, etc will not be included.  Data has not been adjusted for effects of consumers substituting between cash and card payments.  CBA merchant facility spend data is derived from the Merchant Acquiring System which includes net sales from both CBA and Other Financial Institution (OFI) domestic and international cards

Source: Commonwealth Bank of Australia, Global Economic & Markets Research report “CBA Card Spend – ending 31 July 2020”, published 5 August 2020, author Belinda Allen. Full Global Economic & Markets Research disclaimers can be found at www.commbankresearch.com.au

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