Spending plummets to lockdown lows
Alex Mitchell |
Australia is not in lockdown, but we might as well be from a spending perspective.
That is according to ANZ data, which shows national spending has dramatically fallen back to lockdown levels, with hard-hit Sydney and Melbourne showing figures even further below the national average.
And Sydney’s total spending is at its lowest point of the entire pandemic, according to data for the week to January 5.
The other states have not been spared, with dining spending in Western Australia and Queensland similar to that seen in previous lockdown conditions.
WA, Queensland and South Australian total spending figures are at their lowest since their respective lockdowns.
ANZ senior economist Adelaide Timbrell said the positive underlying conditions such as consumer confidence and low unemployment meant “we can be precise in saying that it’s not people trying to save money”.
“It shows the huge impact of Omicron from both the staff shortage side where people can’t go out because of places shutting down, as well as the household side with people not going out as much and spending as much because they don’t want to be out in public and be catching it,” she said.
“It is showing huge amounts of caution … in a very short period of time.”
Ms Timbrell said there were precedents in other countries with a similar experience, but the magnitude of Australia’s decline while not in lockdown was “surprising”.
Looking forward, the length of the Omicron disruption is the big question – and one Ms Timbrell noted was not one for an economist – but it is not all bad news.
“There are some things we know – when the outbreaks go away, the spending malaise also goes away,” she said.
“Once people are happy to go out and about they spend up … as long as it doesn’t disrupt a lot of people’s incomes in a long-term way, we should see a quick bounce-back as soon as the actual health side of it gets under control.”AAP