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Media Release

Tax refunds and housing market stabilising retail sales: CBA research

Latest Household Spending Intentions Series

The outlook for Australian consumer spending may be improving, according to CBA’s Household Spending Intentions Series.

Latest data from the Commonwealth Bank Household Spending Intentions (HSI) series highlights the outlook for consumer spending in Australia may be improving as the tax refunds flow into bank accounts and on the back of the interest rate cuts by the Reserve Bank of Australia.

CBA’s HSI series offers a forward-looking view by analysing actual customer behaviour from CBA’s transactions data, along with household spending intentions from Google Trends search data. This combination adds to insights on prospective household spending trends in the Australian economy.

CBA Chief Economist Michael Blythe says the levelling out of recent HSI readings offers some encouraging, albeit tentative, signs that the tax rebates now being paid to households are boosting disposable income and flowing through to spending intentions.

“HSI measures provide a glimmer of hope that the outlook for consumer spending is slowly improving. The improvement is modest, but the switch from downward signals to something that is more flat-to-up offers some hope that the second half of 2019 will be better for the consumer than the first half of the year,” Mr Blythe said.

The spike in Google search activity on “tax refunds” in July 2019 was the largest recorded in the last five years (since July 2014). “The levelling out in HSI readings for retailing and vehicle purchases offers some encouraging, albeit tentative, signs that the rebates are working,” Mr Blythe said.

“Much will depend on the impact of the tax rebates that households are receiving. Many of these payments are large and are flowing into CBA customer accounts right now. The value of tax refunds in July was 49 per cent above “normal” levels.

“The turn in the housing market is also helping. The drag on consumer spending from a negative "wealth effect" should be receding as dwelling prices stabilise or lift,” Mr Blythe added.

Household Spending Intentions – August 2019 results

CBA obtains an early indication of spending trends across seven key household sectors in Australia. Apart from home buying, the series covers around 55 per cent of Australia’s total consumer spend across;  retail, travel, education, entertainment, motor vehicles, and health and fitness.

  • There are some tentative indications that the long slide in retail purchase intentions is finally stabilising. 
  • The levelling out in HSI readings offers some encouraging, albeit tentative, signs that the tax rebates now being paid to households are boosting disposable income and flowing through to spending intentions.
  • The turn in the housing market is also helping.  The drag on consumer spending from a negative "wealth effect" should be receding as dwelling prices stabilise/lift.  
  • While there some positive indications on parts of the consumer story, a degree of caution remains.
  • Travel spending intentions have levelled out - but remain consistent with weak spending outcomes. 
  • Travel is a discretionary expenditure that households find easy to defer in uncertain times.
  • A weaker Aussie dollar may be having some negative impact on international travel plans. The upside is that a weaker Aussie dollar makes it cheaper for offshore visitors to come to Australia.
Home Buying  
  • The turn in home buying intentions evident since early 2019 continues.
  • Higher auction clearance rates and the recent stabilisation/lift in dwelling prices in Sydney and Melbourne is consistent with the shift in HSI momentum.
  • Surveys regularly conclude that voters want more money spent on government services, including education.
  • Not surprisingly, spending intentions for education have retained a solid momentum over the past few years despite the array of negatives at work.
  • The entertainment HSI reinforces the message that household caution remains a restraint on some discretionary spending.
  • The best that can be said is that entertainment spending intentions are stabilising at a very low level.
Motor Vehicles  
  • Motor vehicle spending intentions weakened sharply in early 2019.
  • The RBA has identified vehicle spending as particularly susceptible to the negative wealth effect of falling dwelling prices.
  • There are some signs of stabilisation in the latest HSI readings. 
  • But, as with entertainment, the best that can be said is that vehicle spending intentions are stabilising at a very low level.
Health & Fitness  
  • Health and fitness spending intentions have bucked the trend in 2019.
  • HSI readings have run around average levels for most of 2019 to date. 
  • A slight acceleration in spending plans is evident in the latest readings.

To find out more about the Household Spending Intentions Series, visit

Notes for Editors:

About the approach

The new approach focuses on Australian households and their spending intentions. Employing near real-time spending readings from CBA’s household transactions data and combining them with relevant search information from Google Trends was used to map the data results on consumer spending. Media assets available include infographic, video and graphs.

About Google Trends

Google Trends is a publically available service that enables people to explore search trends around the world. These searches provide insights into what consumers are doing/researching on the Internet and what their spending intentions are.


This ‘CBA-Google Household Intentions’ series provides general market-related information, and is not intended to be an investment research report. The ‘CBA-Google Household Intentions’ series has been prepared without taking into account your objectives, financial situation (including the capacity to bear loss), knowledge, experience or needs. Before acting on the information in the ‘CBA-Google Household Intentions’ series, you should consider the appropriateness and, if necessary seek appropriate professional or financial advice, including tax and legal advice. The data used in the ‘CBA-Google Household Intentions’ series is a combination of the CBA Data and Google Trends™ data. Google Trends is a trademark of Google LLC. All customer data used or represented in this report is anonymous and aggregated before analysis and is used and disclosed in accordance with the Commonwealth Bank Group’s Privacy Policy Statement.

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