Consumer Spending Remains Resilient
New NAB research shows that during July, consumer spending remained resilient, even while retail spending stayed under pressure, with retailers telling ChannelNews this came to a crashing end in August with sales drying up.
Transaction data showed overall spending rose 0.5% on-month, and June saw a 0.9% rise, with analysts crediting Amazon’s Prime Day sales for the jump in people shopping.
Discretionary and non-discretionary spending rose, while discretionary spending was softer, up 0.9% three month average terms vs. 2% for non-discretionary spending.
Chief Economist Alan Oster for NBA said, “Our monthly transaction data showed surprisingly positive result for July, with spending still holding up.”
Flat nominal retail spending suggested further falls are likely, however the durability of spending, particularly in discretionary sectors including hospitality, recreation, travel, and arts is “impressive.”
Mr Oster continued, “Spending on essential services like healthcare and utilities has also continued to rise and we know this in part reflects the ongoing rises in prices that consumers are facing in many services sectors.”