Households tighten their belts as inflation pressure grows

Latest data from the CommBank Household Spending Intentions Index reflects the current pressures facing households

The Commonwealth Bank Household Spending Intentions Index rose by a modest 0.8 percent for the month of August

Key Points

• The CommBank Household Spending Intentions (HSI) Index rose by a modest 0.8% in August to 115.5, highlighting the momentum in the Australian economy, higher inflation pressures and the impact of the RBA’s monetary policy tightening
• The index saw a weakness in discretionary spending in sectors like travel, entertainment, transport and retail
• Following last week’s fifth consecutive monthly increase in interest rates by the RBA, CBA is forecasting 25bp interest rate increases in October and November