Commonwealth Bank’s latest Household Spending Insights report shows March spending picking up, even as many customers trim non‑essential outlays. CBA says the index rose 2.9% for the month, with more than half of that lift coming from transport as petrol prices surged.
Service‑station spending was the clear driver, while several discretionary categories were flat or softer, suggesting borrowers are reshuffling budgets to cover fuel and other essentials while keeping mortgage repayments on track.
Even excluding transport, CBA reports household spending up about 1% in March, with all 12 categories still recording gains. That pattern means bank statements may look resilient on the surface, but underlying borrowing capacity is being squeezed.
A similar pattern appears in NAB’s data, which shows overall consumer spending up 2.1% in March, with ex‑fuel spending still rising 0.7%.
While the transaction data look solid, confidence is moving the other way. Westpac–Melbourne Institute figures show consumer sentiment dropping sharply in April as rate and fuel shocks bite, with households’ views on their own finances deteriorating and more respondents expecting mortgage rates to rise over the coming year.
CBA head of Australian economics Belinda Allen (pictured) likewise cautions that spending is expected to slow as real household disposable income growth weakens, a trend she says will be critical for the path of interest rates beyond May.
For mortgage brokers, that combination of higher living costs and weaker confidence means clients are more cautious about taking on new debt, even if headline spending appears to be holding up. First‑home buyers, in particular, are likely to find their effective borrowing capacity squeezed as lenders factor in higher transport and everyday expenses on top of existing buffers for mortgage rates.
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