Spending skyrockets as nation emerges from lockdown

With Australian states and territories coming out of lockdown, national spending is up 20 percent from 2019 levels, according to Commonwealth Bank of Australia’s weekly credit and spending data.

NSW recorded a 23.3 per cent increase in spending in the last week of October compared to the corresponding week in 2019.

The increase of in-person spending has not seen a corresponding decline in online spending, a “pleasing indicator of underlying economic strength,” according to Stephen Halmarick, Chief Economist at Commonwealth Bank.

“We are seeing the economic engine rev higher again as people get out and about, catching up on lost time with friends and family,” said Halmarick.

Victoria saw a 20 percentage point increase on eating out expenses and a 30 percentage point increase on drinking out, contributing to nearly half of the national week's increase in spending.

“Victorian retailers welcomed back shoppers this weekend, and we anticipate that will translate into stronger spending on clothing, footwear and general retail in next week’s report as it had done in NSW as lockdown ended,” Halmarick said.

The latest NAB Retail Sales Index from September reveals a 31.3 per cent growth in online sales year on year, suggesting that despite physical stores opening up, online sales remain strong.

NAB chief economist, Alan Oster said that "While generally the highest growth by category continues for the lockdown states, cases of high growth were recorded for categories like homewares and appliances in the non-lockdown state of WA."

"Monthly sales growth for grocery and liquor continued in ACT and VIC, despite a contraction in all other states. Fashion recorded the fastest growth this month, and was fourth fastest over the year, with particularly strong growth in year-on-year terms for the category in locked down NSW and ACT."

In the 12 months to September, NAB estimates $52.04 billion spent on online retail, 28.3 percent more than last years equivalent.