Credit and debit card spending in Australia surged a record amount last week, in a sign the nation might be feeling more confident.
Commonwealth Bank of Australia (ASX: CBA) on Tuesday revealed that the week ending Friday 6 November saw a 13% increase in card spend year-on-year.
That boost is the biggest seen since the bank started weekly analysis 8 months ago.
Commonwealth Bank senior economist Belinda Allen said the lifting of COVID-19 restrictions in Victoria and the opening of interstate borders saw Australians spend up.
“There was a lift in both online and in-store spending showing the breadth of the rise.”
The rise in card use indicated confidence in health was very much linked to confidence in the economy, according to Allen.
“Card spending on both goods and services lifted over the past week, but services spending was the dominant driver,” she said.
“Services spending on cards rose by 5% compared to a year ago and was the first positive print since the nationwide lockdown in March.”
Victorians celebrate getting out of the house
Credit and debit card spending in Victoria was up a stunning 15% for the week ending Friday 6 November, compared to the same period last year.
“Looking at Victoria, pent up demand and an easing of restrictions saw spending rise in all but one category we track, with communication the exception,” said Allen.
“Eating and drinking out still faces some restrictions but spending in this category is recovering and shows growing confidence in the health outcome.”
All states and territories saw an increase in card spend last week, with only the ACT (9%) not recording a double-digit boost.
Despite moving past the lockdown mentality, the household furnishings sector was still 37% up last week compared to last year.
Takeaway alcohol was not far behind, up 29% from last year.
Overnight news of a 90% effective vaccine from Pfizer Inc (NYSE: PFE) and BioNTech SE (NASDAQ: BNTX) sent the share market into a positive frenzy. So it will be interesting to see whether that’s also translated into consumer confidence in the current week’s card spending statistics.