Forty-eight per cent of high-income earners had reduced spending on food-delivery services while 46 per cent of low-income earners were cutting expenditure on food in general or skipping meals. A third of low-income earners sliced spending on insurances, compared to one in five high-income earners.
NAB analysts said high living costs are also leading to a “meaningful” change in consumer behaviour.
“Shoppers across the income spectrum are looking for ways to save money. Consumers are more intentional in the allocation of their disposable income and the purchasing journey is more complex,” they found.
About 45 per cent of all consumers are now “mindful” about their spending, 35 per cent have switched to less expensive products, 23 per cent are researching brands and product choices before buying while 12 per cent said they spend money on “great deals”.
The different mindset is also affecting other choices. The share of consumers consciously buying Australian-made goods fell to 8 per cent while supporting a local business as a reason to support a particular retailer fell to 6 per cent.
The changed outlook continues to be felt by retailers.
The earliest Easter since 2016 resulted in people pulling forward their long weekend spending into March.Credit: iStock
The CBA’s monthly household spending index, based on the de-identified purchasing patterns of the bank’s 7 million customers, rose by a modest 0.2 per cent in March as people stocked up their fridges ahead of the early Easter.
Spending on food and beverages increased by 4 per cent, while there were substantial increases in expenditure at petrol stations (up 7.4 per cent), on ride-sharing services (14.5 per cent) and public transport (6.7 per cent).
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But spending on household goods fell for the third time in four months, down by 1.7 per cent, while spending on recreation dropped by 6.8 per cent. This was driven in part by the departure of Taylor Swift – expenditure through function and event centres jumped 115 per cent in February during Swift’s Eras Tour, but fell 42 per cent last month.
CBA chief economist Stephen Halmarick said that over the past year, the bank’s index was up 3.4 per cent which was in line with inflation. He said the slowdown across the economy, along with easing inflation, should give the Reserve Bank scope to start cutting interest rates.
“Since the November RBA interest rate rise, we’ve seen consistently soft household spending and we retain our view that, when coupled with decelerating inflation, the RBA can start lowering the official interest rate in September this year,” he said.
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