Australian household spending inched up in January as services outlays offset weaker demand for goods, new Australian Bureau of Statistics (ABS) data shows.
Seasonally adjusted household spending rose 0.3% in January, following a revised 0.5% fall in December and a 1% rise in November. In nominal terms, spending was 4.6% higher than in January 2025, but that pace continues to soften.
“Household spending returned to growth in January, rising in five of the nine spending categories,” ABS head of business statistics Tom Lay said in a media release.
Services led the recovery, rising 1%, with gains driven by “other services including digital streaming services and travel agency and tour services.” Health services also contributed, as households spent more on dental services.
Goods spending slipped 0.3%, weighed down by weaker purchases of motor vehicles and recreation and culture goods, marking a second consecutive monthly decline for goods.
Lay noted that non‑discretionary demand is still doing much of the work.
“Essential spending rose 0.8% and was driven by health services and spending on motor vehicle repairs and maintenance,” he said.
Discretionary spending just crept higher, up 0.1%, supported by outlays on air transport, personal effects, and recreational and cultural services.
Commenting on the latest ABS figures, Westpac economist Neha Sharma described the result as steady rather than spectacular. The monthly indicator “rose 0.3%mth in January, in line with its average monthly pace over the past two years,” slightly above Westpac’s 0.2% expectation.
However, Sharma warned that “spending has gone backwards over the year on a real per‑capita basis,” with alcohol and tobacco a notable drag on the headline numbers.
Spending rose in five of eight jurisdictions in January, with Tasmania posting the strongest monthly gain in percentage terms at 0.6%.
New South Wales and Victoria both recorded 0.5% growth, after sharper falls in December, while Western Australia rose 0.3% and Queensland 0.1%. The Northern Territory recorded the steepest fall, down 2.3%, and South Australia slipped 0.1%.
The latest national accounts show Australia’s economy ended 2025 on a solid footing, with 0.8% quarterly GDP growth and broad-based industry gains offsetting softer household consumption.
Sharma said recent data, including weaker‑than‑expected household consumption in the latest GDP release, suggest the consumer picture is no longer about rapid growth. Instead, “the consumer story appears to be one more of stabilisation,” with services spending and essential categories propping up an otherwise cautious household sector.
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