Commonwealth Bank Business Sales Indicator (BSI) measures economy-wide spending

+0.6% m/m in trend terms in March (strongest growth in 15 months)

  • Average was just 0.2% over the prior 5 months

Annual trend growth in sales rose from 2.5% in February to 3.1% in March

  • Strongest result in four months

Seasonally adjusted BSI +1.4% in March

  • Up 1.7% in February
  • Annual growth +5.2% after averaging 2% growth in the previous five months

17 of the 19 industry sectors expanded in trend terms in March

  • up from 15 sectors in both January and February

CBA comments:

  • The broad-based gains across the majority of industries and across all the states and territories suggest that spending growth is recovering after a relatively soft period.
  • CBA caution that 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.
  • Low interest rates and the wealth effect of rising home prices should support spending, the modest wage growth and uncertainty about the Federal Budget could serve as a brake on activity

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The Commonwealth Bank BSI is obtained by tracking the value of credit and debit card transactions processed through Commonwealth Bank merchant facilities

The BSI covers spending broadly across the economy rather than just retail sales, including spending on automobiles, personal services and airlines

  • The Business Sales Indicator includes transactions made at traditional retail establishments such as supermarkets, clothing stores and cafes & restaurants and as such is more comparable to the ABS Household Final Consumption Expenditure released on a quarterly basis
  • The Business Sales Indicator also covers businesses such as airlines, car dealers and utilities such as water and electricity companies as well as motels, business, professional and government services and wholesalers

more to come