Australia’s consumers are still spending, but the latest NAB figures show a clear shift towards essentials as fuel prices surge and households brace for higher mortgage rates.
NAB’s Consumer Spend Trend report shows total spending rose 2.1% in March, driven by a 33.5% jump in fuel outlays. Excluding fuel, spending still increased a solid 0.7% month‑on‑month, led by a 1.7% rise in food retail, as some households appear to be stockpiling non‑perishable groceries.
Across the states, spending rose everywhere but was strongest in South Australia (up 2.9% month on month) and Queensland (2.7%), with growth in these markets extending beyond fuel into categories such as hotels, travel, transport, and household goods.
Non‑discretionary categories such as utilities and health also saw continued growth, while discretionary services like hospitality, hotels, travel and cafés recorded small monthly declines.
Crucially for brokers, the report finds that spending growth among mortgage holders over the past 12 months was around double the pace seen a year earlier, with this group showing stronger growth than non‑mortgage holders across almost all categories. Higher average fuel and construction spending means the latest price shock is likely biting hardest for borrowers already servicing home loans.
NAB data also show that consumers aged over 65 recorded the fastest growth in spending across most categories – particularly fuel, utilities, and food – and that lower income households have seen stronger growth in day to day spending than higher income groups, underlining where budget pressures are most acute.
That pattern lines up with a sharp deterioration in household sentiment. The Westpac–Melbourne Institute Consumer Sentiment Index plunged 12.5% in April to 80.1, its steepest monthly fall since the onset of COVID, as Australians face another “cost of living” shock.
One offsetting factor is that incomes are holding up. CommBank’s wage series shows average pay rising 0.8% over the three months to March, with annual growth steady at 3.1%. CBA’s Labour Insights also estimates about 23,000 jobs were added in March, with employment “remain[ing] resilient in the face of rising interest rates and the Middle East conflict”, even as the bank expects unemployment to edge higher.
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