Australian Household Spending Rises 0.6% in September After Falling the Previous Month

Key Facts

Australian household spending rose 0.6% in September 2026 month on month, according to seasonally adjusted, current-price data published by the Australian Bureau of Statistics. The increase followed a 0.1% decline in August, after a 1.0% rise in July. Year on year, spending increased 6.8% through September, reaching a seasonally adjusted A$82,610.8 million for the month. Reuters reported that analysts had expected an increase of about 0.2%, following August's decline. The data put household spending at the center of monitoring domestic demand, as the Reserve Bank of Australia's announced interest rate increase took effect on 4 November.

The volume measure, which excludes the effect of price changes, rose 0.7% in the September quarter and was up 3.2% year on year in the quarter. These figures provide a quarterly picture that differs from the nominal monthly spending reading, measuring the volume of purchases rather than their monetary value. Among monthly spending components, transport and health each rose 1.5%, while recreation and culture spending increased 0.8%. The Bureau of Statistics said spending rose across both essential and discretionary categories. The increase in transport included fuel, vehicle repairs and maintenance, and domestic air travel associated with attendance at major sporting events.

Fuel spending rose 5.4% in September, which the Bureau of Statistics attributed to higher global oil prices and the end of the fuel tax relief on 3 August. But the bureau's experimental data indicated that fuel spending volume fell 2.2% in September, after declining 0.6% in August. That means the monetary value of fuel spending rose in the same month that its volume fell, according to the experimental measure. In health, the increase was linked to higher spending on general practitioner visits and dental and optical services, as well as medicines and personal care products. The bureau said a later influenza season likely added to demand for medical consultations and medicines.

The September reading comes as the central bank tightens monetary policy, with the cash rate target at 4.85% from 4 November, following an increase of 0.25 percentage points. Governor Michele Bullock said on 3 November that the tightening was aimed at domestic capacity pressures, adding that these pressures "were evident before the rise in oil prices." The bank had raised rates four times during 2026 before the November decision, according to Bullock, who also said spending had slowed, house prices had fallen and labor market conditions had eased. In its November forecast, the bank said household consumption growth was 0.4% in the June quarter and its annual growth had slowed to 1.8%. It also assessed that consumption growth in the September quarter had changed little from the below-trend pace of the June quarter, while acknowledging that this assessment was uncertain because available indicators diverged.

Spending data remain part of an inflation backdrop the bank describes as persistent; in its November outlook, it forecast that inflation would not return to the midpoint of its 2–3% target range before mid-2028. Bullock said entrenched high inflation could require interest rates to remain elevated for longer, with greater risks to economic growth and jobs. Market pricing, according to the bank's staff estimate, reflected an 85% probability of a rate increase in November and also implied about one and a half rate increases by mid-2027. September data recorded increases in transport, health and recreation, while fuel showed a divergence between spending value and actual volume. The Bureau of Statistics will release its October household spending indicator reading on 30 November 2026, the next milestone for tracking spending after the rate increase decision.