Spending continues to grow steadily across the economy - so why are clothing sales struggling?
The latest Commonwealth Bank Business Sales Indicator (BSI) reveals steady spending for the month of August, rising 0.5 per cent over the month.
This is in line with the average monthly growth rate over the past decade
The BSI tracks value of credit and debit card transactions processed through Commonwealth Bank point of sale terminals.
The August BSI shows sales continuing to grow at around the same steady pace as the last six months, making it the 37th consecutive month of sales growth nationally.
The more volatile seasonally adjusted measure grew by 0.8 per cent in August, down from a 1.6 per cent increase the month before.
That saw the seasonally adjusted annual growth rate ease to 9.9 per cent, down from 11.9 per cent in July.
In trend terms, 15 out of 19 industry sectors saw sales rise during August, a similar result to the previous two months.
However, unseasonal weather continued to impact clothing store and utilities sectors, with spending down 1.4 per cent and 1.7 per cent respectively.
This is despite a number of sectors have seen sales grow by 20 per cent or more over the last 12 months.
These sectors include Amusement & Entertainment, Transportation, Mai Order & Telephone Order Providers, Service Providers and Wholesale Distributors & Manufacturers.
During August, sales rose across most of the country.
South Australia was the strongest performing state for the fifth month in a row, recording growth of 1.4 per cent in trend terms, while sales in Queensland were up 1.1 per cent.
Spending has now risen for 38 straight months in Qld, 30 months in Tasmania, 24 months in New South Wales and 23 months in SA.
Sales in Victoria have been either flat or higher for 38 consecutive months.
Sales growth in Western Australia has stalled over the last few months, with spending rising just 0.1 per cent in August after staying flat in July and falling 0.1 per cent in both May and June.
Northern Territory spending was up 0.2 per cent.
Meanwhile, spending in the Australian Capital Territory fell in August, although the rate of decline slowed to only 0.1 per cent in trend terms.
Commonwealth Bank local business banking executive Adam Bennett said the latest figures reflect the transition from a mining-led economy to a broader-based growth profile.
“Overall, the August BSI shows business conditions remain favourable across most of the country. This month’s results also reveal some unevenness between regions and sectors, as businesses continue to adjust to an economy in transition.
“For business owners, it is important to be aware of these variations to ensure they are planning ahead and proactively managing their businesses cash flow,” Bennett said.
BSI report author Craig James said while there are still some areas of weakness, the overall business environment has improved.
“The latest job advertisement and unemployment data reflects a strengthening employment market, helping to underpin consumer spending. Both businesses and consumers have also been starting to take advantage of low interest rates, with lending growth continuing to recover.
“Much of that borrowing is being channelled into new housing and business investment, which should help to sustain further growth,” James said.