Australian consumers and businesses have started 2013 on a positive note with the latest Commonwealth Bank Business Sales Indicator showing economy-wide spending lifted in January.
According to the BSI, spending increased by 1.9 per cent in seasonally adjusted terms in January, after falling by 1.3 per cent in December.
The underlying spending trend also rose in the same month by 0.8 per cent, marking the fifth straight monthly gain in spending and the strongest increase in 10 months. Additionally, annual stands at 6.4 per cent.
Adam Bennett, executive general manager, local business banking, Commonwealth Bank, believes the latest results provide businesses with a more positive outlook for the year ahead.
“While Christmas spending did not have the impact many businesses had hoped for, the results of January spending offered some positive news. The results show that although spending patterns remain erratic, consumers are still willing to spend and confidence is heading in the right direction,” he said.
“The good news is we also saw solid annual increases in sectors such as amusement and entertainment and retail, which heavily rely on the busy festive period.
“As businesses look to the year ahead, it is important to continue to focus on efficiency and have plans in place to navigate future fluctuations in spending habits and consumer sentiment.”
None of the states and territories recorded weaker sales in trend terms in January. Sales rose most in the ACT (up 1.7 per cent), followed by Western Australia (up 0.9 per cent), NSW, Tasmania and Victoria (each up 0.8 per cent), Queensland (up 0.4 per cent), Northern Territory (up 0.3 per cent) and South Australia (up 0.2 per cent).
Craig James, chief economist of the Bank’s broking subsidiary CommSec and author of the BSI, believes the latest results demonstrate that consumers are making solid steps in the right direction.
“The lift in spending in January coincided with post-Christmas sales, suggesting that consumers are more inclined to spend when goods or services are discounted. However, we have seen positive indicators for some time now, with the underlying trend pattern ticking upward for the past five months,” he said.
“Hopefully as the international picture begins to brighten we will see further gains in spending in coming months.”