Household Spending Growth Stalls in August as RBA Prepares Another Rate Hike

Australian household spending growth stagnated in August, according to fresh data from the Australian Bureau of Statistics. The numbers showed that August's household expenditure was essentially flat compared to July, falling short of economists' projected 0.4% increase.

However, when compared to the same period last year, household spending rose by 6.8%, slightly below the forecasted 7.1%. Tom Lay, the ABS's head of business statistics, attributed the slowdown in recreation and culture spending to the end of major sporting events, which was partially offset by increased transport costs.

Lay also noted a notable increase in electric-vehicle purchases, with households reacting to higher fuel prices. This trend is expected to continue as fuel prices remain high.

The Reserve Bank of Australia (RBA) is set to make another interest rate decision later this afternoon, with expectations pointing towards a fourth consecutive hike to 4.6% to combat inflation and cool demand.