Australians kept spending in August

The CBA’s household spending intentions for August rose a solid 0.8% m/m to be up 15.1%y/y (July +1.1% m/m 12.2% y/y). This is another solid result given cost-of-living pressures and rising interest rates, and reflects the continuing strength of the economy and the labour market. As there is a lag between RBA rate hikes and their impact on households, the CBA expects household spending to soften going forward.

• The CBA noted that the strength in the index was only narrowly based and was centred on home buying, health & fitness, motor vehicles and household services. There was weakness in travel, entertainment, transport and retail.
• This measure is holding up a lot better than consumer confidence, which prints in just over an hour, and seems to be moving more closely with retail sales.