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Australia household spending flat in August as fuel surge offsets weakness
Excluding fuel, the Australian Bureau of Statistics estimated household spending would have fallen 0.3% in August, highlighting softer underlying demand.
Australian household spending grew 0.0% in August after 1.1% growth in July, according to data reported by Action Forex, which noted that the headline result overstated underlying demand.
The ABS said spending was still 6.8% higher than a year earlier, but higher transport costs provided an offset to weakness in other categories. Transport spending rose 2.3%, while recreation and culture fell 1.4%, clothing and footwear dropped 1.0%, and alcoholic beverages and tobacco declined 1.0%.
Fuel spending distorted the overall figure, surging 8.1% after the full restoration of fuel excise duty from August 3. Excluding fuel, the ABS estimated total household spending would have fallen 0.3%, and experimental volume estimates showed fuel spending volume actually fell 0.5% after a 4.6% drop in July.
Goods spending still rose 0.3%, supported by motoring goods and vehicle purchases, while services spending fell 0.3%. The composition pointed to a loss of household spending momentum rather than broad demand strength after two solid months, Action Forex said.