Noise In Latest Batch Of CBA Card Spending Data

CBA note that their latest card spending data “contains some seasonal noise with a large fall in spending growth in the week to 16 December 2022. We expect this is caused by the corresponding week in 2019 finishing 4 days closer to Christmas than this year.”

• “The impact of this being that there were large falls in growth for goods and retail spending. Categories that usually have a large rise in spending around Christmas such as alcohol goods, general retail and clothing & footwear all saw very large falls in spending growth.
• “There was a fall in spending growth on domestic fuel and power over the past few weeks. This is curious given the widely reported increases in the price of utilities that households are facing at present. State government rebates as well as end of year disruptions to billing cycles may be playing a role.”
• “The resilience of household spending in H222 has been a surprise, however there are signs in CBA and official data that a moderation of spending growth is underway. The lag in the transmission of monetary policy, accumulated savings and a strong labour market are supporting spending longer than expected in the context of high inflation and rising interest rates. However, as the full extent of the rate hikes flow through, and many mortgage holders roll off their fixed rate in 2023, we expect to see a more significant slowing in household consumption.”