Business sales edged upwards in August and recorded their strongest result for four months, with experts suggesting that whilst it isn’t a strong result, it’s a good start in the right direction.
The Commonwealth Bank Business Sales Indicator (BSI), which tracks the value of credit and debit card transactions via CBA point-of-sales terminals, fell 0.1 percent last month, up from a decline of 0.3 percent in July and an 0.5 percent fall in June.
Commonwealth Bank Executive General Manager of Local Business Banking Matt Comyn said the latest result is welcome given the broader market uncertainty.
“We are seeing more stability in the market in terms of the outlook for interest rates which is helpful, however we are still living in volatile times and there continue to be a range of other factors preying on the consumer’s mind.”
CommSec Chief Economist and BSI author Craig James referred to the result as “encouraging.”
“In seasonally adjusted terms the BSI actually posted a rise of 0.6% in August, the first positive reading since June and the strongest increase in spending in six months.“
“There may be brighter times ahead for Australian businesses however the picture across the economy remains mixed. The Retail Stores sector looks set to continue its struggle yet there is positive news in that we are witnessing an ongoing shift in consumer behaviour with the Amusement and Entertainment sector posting consistent growth in sales.”
Seven sectors contracted last month, down from eight in July and nine in June.
The weakest sector was Contracted Services, which includes building trades such as electricians as well as veterinary services, down 0.8 percent. Automobiles & Vehicles was down by 0.7 percent, whilst sales at both Government Services and Retail Stores were down 0.3 percent.
Sales in Amusement & Entertainment (includes motion picture theatres, bowling alleys, golf courses and video stores), up 0.8 percent in trend terms last month, followed by Business
Services (up 0.7 percent), Repair Services (up 0.6 percent) and Transportation (up 0.4 percent).