NAB’s Chief Economist, Alan Oster provides his thoughts on the Australian and Global economy.
Consumers spending their disposable dollars on experiences
Australians are increasingly looking for experiences to spend their disposable dollars on and are dining out at cafes and restaurants, staying at hotels, and buying theatre and concert tickets, according to new data released by NAB today.
The Customer Spending Behaviours report, based on around 2.7 million daily consumer transactions, found creative services such as performing arts and music had the fastest growth at 35.3 per cent followed by accommodation and food at 26.7 per cent.
NAB Chief Economist Alan Oster said the report gives an important insight into household budgets across the country.
“By examining such a large number of daily transactions, we can show where spending is growing fastest, even down to a postcode, and what our customers are spending it on,” Mr Oster said.
The report also found consumers had boosted their average monthly spending during the quarter to $2,064 in metropolitan areas ($1,997 in Q1 2017) and $1,918 in regional areas ($1,866 in Q1 2017).
In addition, it showed spending on consumption-based goods and services by NAB customers grew by 3.9 per cent over the year to Q2 2017, accelerating from 2.0 per cent over the year to Q1 2017.
“Customer spending growth improved in all metropolitan and regional areas (except Tasmania), with overall spending growth in regional areas continuing to outpace cities,” Mr Oster said.
“Perhaps lower mortgage debt in regional areas is freeing up more disposable income for these consumers resulting in faster growth.”
Mr Oster said retail trade is still a key part of the spending patterns but growth is increasingly coming from consumers wanting to head out to have meaningful experiences.
“We can see consumers are getting out of the house, spending their disposable income on eating out, staying at hotels and enjoying music and the performing arts,” Mr Oster said.
“This was particularly seen in Victoria, where growth was fastest in the suburbs of Hurstbridge and Garfield, followed by Quakers Hill in NSW.”
NAB’s data excludes spending on mortgages and other credit facility payments and government services.
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