CommBank’s Monthly Household Spending Index showed an increase in spending intentions fueled by transportation costs and home buying intentions.
After a revised decline of 9.5% in January, CommBank’s Household Spending Index (HSI) rebounded in February, rising 1.8% to an index of 107.3.
CommBank’s HSI series includes 12 expense categories, covering the majority of all consumer spending.
Transportation spending intentions jumped 11% in February, boosted by rising fuel prices and increased spending on taxis, parking lots, car washes, freight and trucking services.
The NRMA said 91 unleaded fuel prices could soon hit $2 a liter.
Spending intentions to buy a home rose 29.6% as summer holidays returned, but fell 4.4% from February 2021.
Insurance costs edged down 0.6% in February, but ABC economists believe recent flooding on Australia’s east coast will weigh on this category in the coming months.
ABC Chief Economist Stephen Halmarick said February’s rise in the CommBank HSI Index showed Australians were back on track after COVID restrictions ended, but events unfolding across the world should have three main implications.
“We see three main implications for the Australian economy from the situation in Ukraine – market sentiment and a ‘flight to quality’; higher energy prices and inflation; and reduced global growth,” he said. said Mr. Halmarick.
Read more: What does rising inflation really mean?
Recently, ME Bank‘s Household Financial Comfort Report revealed that the cost of basic necessities has become the most important concern for 43% of Australian households.
ME Bank Consulting Economist Jeff Oughton said rising costs of basic necessities and steady wage growth are causing growing concern among households.
“On the surface, the average Australian’s financial comfort looks better than ever, but it is fragile,” Mr Oughton said.
In the immediate term, AMP’s chief economist, Shane Oliver, said it was important that Australians remain cautious about their spending behavior, continue to pay down debt, mortgages and don’t let themselves not be carried away by any reopening.
Crude oil is up 69% in the past 12 weeks and at its highest level since 2008.
Only time in history when oil has risen more than that over 12 weeks…
-August 1990 when Iraq invaded Kuwait (the US recession started that month).
-June 2020 when prices rebounded from the pandemic crash. pic.twitter.com/AJbWgnkGsX
—Charlie Bilello (@charliebilello) March 7, 2022
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