Consumer spending solid in November: CommBank BSI
Economy-wide spending grew 0.4% last month, lifted by sales growth in the tourism and retail sectors, the Commonwealth Bank’s November Business Sales Indicator (BSI) showed.
Annual growth in spending increased 7.3% from 7.2% in October – the fourth consecutive month where annual growth stayed in the range of 7.2% to 7.3% -and remained above the decade average of 5.1%.
“Businesses dependent on domestic Aussie tourism continue to record healthy sales gains in response to a lower Aussie dollar. Hotels and motels led the sales gains in November,” CommSec chief economist, Craig James, said in a note on 21 December.
“Overall, the encouraging growth of the Business Sales Indicator is yet another sign that the economy is humming along nicely into the end of the year and the start of 2016. The lift in business spending lines up with other evidence that employment growth has been firm,” he said.
Sales rose in 13 of the 19 industry sectors in November, with notable gains in business services, hotels and motels, and mail or telephone order providers. Large retail stores saw spending growth of 0.5% in the lead up to Christmas.
The sectors in which spending declined last month included amusement, automobiles and wholesalers.
In annual terms, only four of the 19 industry sectors had contracted spending.
Across the states, sales increased in six of the eight states and territories in November, led by a 1% growth in both Tasmania and Victoria.
Sales dropped 0.2% in New South Wales, the most among the states and territories, followed by a 0.1% decline in South Australia.
In terms of annual growth, Tasmania had the biggest increase at 11.2%, followed by the Australian Capital Territory at 9.4%. The Northern Territory and New South Wales had sales below a year ago, down 3.5% and 0.9%, respectively.
“There are more signs of rebalancing in the economy with Tasmania leading the way on spending but NSW recording weaker growth,” said James.
The Commonwealth Bank BSI tracks the value of credit and debit card transactions processed through Commonwealth Bank merchant facilities.
The BSI includes spending broadly across the economy, covering transactions in traditional retail establishments such as supermarkets, clothing stores, cafes and restaurants, as well as in automobiles, airlines, utilities and professional services.