 Index was flat in January, unchanged at 153.4.){kind=link}
The monthly CommBank Household Spending Insights (HSI) Index was flat in January, unchanged at 153.4.
Modest spending increases were seen across six of the 12 spending categories, with the most notable uplifts seen in spending on motor vehicles (up 1.5%), insurance (up 1.2%), and health (up 1%).
The biggest spending falls in January were in education (down 1.8%), driven by reduced spending on universities, hospitality (down 1%) and household goods (down 0.9%).
“The flat January HSI result was somewhat expected following the spike in spending we saw in the last three months of 2024 off the back of Black Friday, Cyber Monday and Boxing Day sales. Essentials made up the three highest spending categories in the month as consumers pulled back on discretionary spending,” says Commonwealth Bank of Australia Senior Economist Belinda Allen.
“We expect the RBA to lower interest rates at their first meeting of the year next week which will help provide a boost to consumer spending over the coming months. We anticipate a total of 100 basis points of monetary policy easing throughout 2025 to drive an improvement in the consumer spending pulse.”
On an annual basis, CBA says homeowners with a mortgage (up 3%) have surprisingly seen a larger increase in spending compared to those who own their home outright (up 2.8%), while renters continue to lag (up 2%).
“The increase in spending by those with a mortgage can be attributed to the fact that not only are this cohort likely at a stage of life where they’re spending on essential items, they’re still dedicating a significant share of their wallet to recreation and entertainment,” says Ms Allen.
The CommBank HSI index tracks month-on-month data at a macro level. It’s based on de-identified payments data from approximately seven million CBA customers, comprising roughly 30% of all Australian consumer transactions.