Citi Australia
Citi Australia Credit Card Index: March 2021
HIGHLIGHTS
Consumer confidence bounces back, and travel returns to the agenda
Highlighted Findings:
- Airline spend has improved 69% month on month, showing Australians are slowly returning to travel, though this does remain 44% down year on year
- Spend increased 23% month on month comparing March to February, as consumer confidence builds
- Year on year, spend is marginally higher (2%) indicating the post-COVID stabilisation of the economy continues
"Spend is now slightly higher year on year compared to 2020. This strong rebound post-Covid is a pleasant surprise that speaks to the return of consumer confidence in the Australian economy. The Easter holidays have also spurred increased spending, as consumers lock in travel plans and prepare for holidays." said Choong Yu Lum, Head of Credit Cards at Citi Australia.
Top 10 – spend by industry
March
| Category | % share of spend |
|---|---|
| 1. Supermarkets | 9.34% |
| 2. Household good retailing | 7.40% |
| 3. Insurance | 7.02% |
| 4. Business Services | 6.48% |
| 5. Health/Medical | 5.64% |
| 6. Legal/Tax Services | 5.61% |
| 7. Restaurants | 5.03% |
| 8. Sports and hobby stores | 4.27% |
| 9. Retail Goods | 4.10% |
| 10. Hotels, Resorts and Spas | 3.53% |
"Notably this month, spend at restaurants increased 34%, perhaps reflecting Australians getting out to mark either end of term or Easter holiday celebrations. While airline spend is still lower than usual, ranking 16th as a spend category, spend increased 69% compared to February indicating travel is gaining in popularity," Mr Lum said.
The difference a year makes
"March 2020 was when we started to see the first impacts of the Covid-19 pandemic on spend. Borders closed, as did non-essential services and lockdown restrictions were implemented. While total spend figures for February and March figures are now back to pre-Covid levels, certain spend categories have not recovered," Mr Lum said.
| Category | % drop from March 2020 |
|---|---|
| 1. Travel/Cruise lines | 45.29% |
| 2. Airlines | 44.28% |
| 3. Liquor stores | 35.27% |
| 4. Public Transport | 32.26% |
"As anticipated, the travel categories are the most impacted with cruise lines and airlines experiencing the biggest drop in spend compared to this time last year. Despite this, government support measures, including its recently announced $1.2 billion tourism support package, are starting to show dividends with spend on these categories increasing.
"Public transport remains down as well, presumably as typical commuters now work from home more frequently. Liquor stores are the outlier here, though perhaps this drop can be attributed to 'panic buying' of liquor in March 2020 causing a temporary spike in figures, with more normal spend returning today," Mr Lum added.
What's next?
"April's spend figures should reflect a spike in leisure and travel activities, due to the school holidays. While in March we have seen consumers booking holidays, in April we should see holidaymakers spending in local economies, which will hopefully give domestic areas a much needed boost in consumer spending. Additionally, with a travel bubble to New Zealand opening up mid-April, we may also see overseas spend start to increase for the first time since the border lockdown." Mr Lum concluded.