Consumer spending in January declined 10.2% from December, according to the latest Beforepay Cost of Living Index.
Australians reduced their average daily spending to $58.12 in the month, down from $64.69 in December 2023. The month-on-month decline was greater than that seen between December 2022 and January 2023, when spending fell 8.4%, indicating slightly higher holiday spending this year and correspondingly greater cutbacks. The January figures are up 2.3% year-on-year from $56.83 in January 2023.
Consumers decreased their spending in all categories tracked by the index with the exception of utilities, which saw a slight increase of 1.3%, rising to $6.10 from $6.02, driven in part by the warmer weather. Groceries experienced a slight dip of 1.7%, from $15.43 to $15.17, with more people eating at work than over the holidays.
Spending on food and drink, petrol and auto, along with durable goods shopping, entertainment, and fitness and health, all fell. The fitness and health sector observed a 12.5% decline, dropping to $2.45 from $2.80, while entertainment and durable goods shopping fell by 10.4% and 14.4%, respectively. The most significant drop was in general shopping, which plummeted by 33.3% to $6.80 from $10.19, following a spike over the holiday.
Jamie Twiss, CEO of Beforepay (ASX:B4P), commented on the latest data: “The January 2024 figures show that Australians are making sensible decisions about spending after relaxing during the holidays. Across-the-board reductions, while never fun, are an appropriate response to the higher spending we saw in December.”
For more information about the Cost of Living Index visit the Beforepay website: https://blog.beforepay.com.au/tag/cost-of-living-index
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