Spending has risen for the 17th consecutive month as business conditions improve, partly thanks to a lower Australian dollar.
Economy-wide spending in January rose 2.2 per cent, according to the Commonwealth Bank’s Business Sales Indicator (BSI).
Spending was up 12 per cent in the 12 months to January, seasonally adjusted, compared to 10.7 per cent in the year to December.
CommSec chief economist Craig James said further gains would come if consumer sentiment improves.
“Conditions are largely positive, with the Reserve Bank indicating that interest rates are likely to be left on hold in the medium term,” he said.
“The lower Australian dollar is already making life easier for local exporters, and a pick-up in the housing market suggests it may be set to take over as a key driver of the economy as mining investment declines.
“But consumers are still relatively cautious, with sentiment dipping again in February. As sentiment improves, there could be scope for spending to lift even further.”
CBA local business banking general manager Adam Bennett said the strong gains recorded at the end of 2013 continued into the new year.
“These figures are great news for businesses looking to build up their cash reserves and begin 2014 on a positive note,” he said.
“But it’s also important to remember that January is traditionally one of the strongest months of the year for many businesses, particularly in retail.”
The report showed that spending was up in 18 of the 19 industry sectors, with transportation the strongest performer in January, followed by the hotels and motels sector.
The BSI tracks debit and credit card transactions at CBA’s point of sales terminals.
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