November Household Spending Increased Due to Black Friday Deals
The increase in household spending in Australia, particularly in recreation and culture, was mainly driven by the release of movies such as Moana 2 and Gladiator II.
In November, household spending in Australia showed a modest rise of 0.4 percent, following a stronger 0.9 percent increase in October, according to seasonal figures released by the Australian Bureau of Statistics (ABS).
November’s growth was primarily fueled by significant retail activity, including the Black Friday sales, which boosted spending in sectors like recreation and culture.
Spending on recreation and culture increased by 0.9 percent, driven by Black Friday promotions and the release of major films like Wicked, Gladiator II, and Moana 2.
“Spending on Clothing and Footwear also rose by 1.8 percent, while Furnishings and Household Equipment saw an increase of 0.8 percent,” said ABS Head of Business Statistics, Robert Ewing.
These gains in discretionary spending indicate a broader recovery in sectors like new vehicle purchases, with notable rises in SUV sales, further boosting consumer confidence and expenditure in November.
Spending Growth Across States, Some Declines in Territories
The growth in household spending was widespread, with several states and territories posting increases.
Queensland led the way with a 0.7 percent rise, followed by Victoria, South Australia, and Western Australia, all recording 0.5 percent growth.
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However, the Australian Capital Territory and Tasmania experienced slight declines of 0.4 percent and 0.2 percent, respectively.
In November, total retail sales reached $37.1 billion, reflecting a 3.0 percent increase compared to the same month in the previous year, with promotional activities extending throughout the entire month, not just concentrated on Black Friday.
Department stores saw a 1.8 percent rise, while cafes and restaurants enjoyed a 1.5 percent uptick, indicating continued spending on non-essential experiential purchases.
Analysts Cautious on Long-Term Consumer Trends Amid Retail Growth
Despite the rise in retail spending, analysts remain cautious about long-term consumer trends.
Lead economist Ben Udy from Oxford Economics Australia pointed out that the increasing popularity of Black Friday sales has made it challenging to assess the underlying strength of consumption accurately.
John Humphreys, Chief Economist at the Australian Taxpayers Alliance, highlighted that underlying inflation is decreasing, but the cost-of-living pressure persists due to macroeconomic and microeconomic issues.
He emphasized that excessive government intervention in the economy has led to runaway inflation and stagnant productivity, contributing to the ongoing cost-of-living crisis in Australia.
