Below trend growth to continue
With COVID-19 restrictions easing across much of the country, consumer anxiety has continued to moderate and spending behaviours are shifting.
Consumers are essential to Australia’s ongoing economic recovery post COVID-19 with household expenditure making up around 60% of our economy. With the impact of the virus continuing to play out in very different ways depending on location (both in terms of the spread of the virus and the government’s response), consumer sentiment and behaviour is now varying widely by region – with VIC and NSW the only states where consumers are more anxious. Overall, household spending behaviours are becoming a little less conservative, but are softer than a year ago. As restrictions started to ease across much of Australia, spending on non-essentials improved slightly, particularly eating out, entertainment, travel and holidays. Consumers are also becoming a little more optimistic about the likelihood of making a major purchase over the next year, particularly in areas such as home renovations. On balance, however, consumers still expect to spend less on cars, investment properties, school fees and holidays.
No other event in our lives have changed consumer behaviours as suddenly and radically as COVID-19. This provides businesses with a unique opportunity to engage with their customers (both new and existing) in innovative ways and potentially help shape behaviours going forward. In this report, for the first time we asked consumers how their shopping and purchasing behaviours are changing during COVID-19. Many consumers have been supporting local business, buying online and shopping on new websites. At the same time, value perception and reliability is becoming increasingly important in framing purchasing decisions and consumers are doing more research before buying.
For further information, please read the NAB Consumer Anxiety Survey Q3 2020
© National Australia Bank Limited. ABN 12 004 044 937 AFSL and Australian Credit Licence 230686.