CBA Business Sales Indicator 20 Apr 17: Economy-wide spending picks up pace

Economy-wide spending rose by 0.6% in trend terms in March – the strongest growth in 15 months. Growth had averaged just 0.2% over the prior 5 months.

·      Spending growth has averaged 0.3 per cent a month in trend terms over the past year.

·      While the latest improvement in the BSI was encouraging the timing of Easter may have played a part in the volatility of the result. A clearer picture of economy-wide spending should emerge over the next couple of months.

·      Annual trend sales growth rose from 2.5 per cent to a 4-month high of 3.1 per cent in March.

Across sectors, 17 of the 19 industry sectors rose in trend terms in March. The biggest drop in sales occurred at Business Services (down 0.7 per cent) and Retail Stores (down 0.3 per cent). 

·       On the other side of the equation, the strongest gains in sales occurred in Service Providers (up 1.9 per cent) from Government Services (up 1.4 per cent) and Automobiles & Vehicles and Miscellaneous Stores (up 1.2 per cent).

·       Other notable trend increases in sales occurred in Mail Order/Telephone Order Providers (up 1.0 per cent), Hotels & Motels (up 0.9 per cent) and Professional Services & Membership Organisations (up 0.7 per cent).

·       In annual terms in March, only three of the 19 industry sectors contracted: Mail Order/Telephone Order Providers, Transportation and Retail Stores.

·       At the other end of the scale, sectors with strongest annual growth in March included: Automobiles & Vehicles (up 17.1 per cent), Service Providers (up 16.7 per cent) and Hotels & Motels (up 15.6 per cent).