Economic Dashboard

Australia

Real-time market intelligence, economic indicators and sector analysis

Updated 1 Aug 2026 2,788 Indicators

Market Overview - August 2026 Economic Summary

Two-speed economy: assets boom, wages cool, and the RBA holds its nerve

Australia enters August 2026 pulling in two directions at once. Headline growth of 2.5% and a sharemarket flirting with record highs sit alongside a labour market that is visibly softening and inflation that refuses to fully retreat. The RBA has held its nerve at 4.35% for three straight months, with CommBank tipping it stays there through year's end - leaving households to ride a housing boom built increasingly on borrowed confidence rather than income.

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GDP & Economic Output

Economy expands 2.5% but per capita gains tell a more modest story
Australian GDP reached $695.9bn in the March Quarter of 2026, with the annual total at $2.76t — up 2.3% year-on-year. Headline growth of 2.5% masks modest per capita gains of just 1.0%, as population growth dilutes individual gains. Manufacturing, Financial Services, and Mining are running well above their 10-year averages, while Agriculture contracts against a long-run norm of +4.0%. Growth momentum appears to be stabilising at a moderate pace.

Australian GDP totalled $695.9bn in the March Quarter of 2026, reaching a combined $2.76t over the rolling year. The economy expanded 2.5% year-on-year, with the annual measure growing 2.3%. Growth appears to be stabilising at a moderate pace, supported by broad-based gains across goods-producing industries and financial services. The trajectory suggests a recovery phase building from a period of significantly weaker aggregate expansion, with momentum now running across multiple sectors simultaneously.
At $25,033 per person in the March Quarter, GDP per capita grew just 1.0% year-on-year — well below the 2.5% headline rate. With population growth of approximately 1.5% absorbing much of the aggregate expansion, gains per person remain modest. This persistent divergence between headline and per capita growth means the average Australian's economic output is growing at roughly two-fifths the pace of the economy as a whole — a dynamic that continues to define Australia's current economic cycle.
Manufacturing output surged 3.2%, running 2.8 percentage points above its 10-year average of 0.4% — the standout industrial performer. Financial Services expanded 4.9% against a long-run average of 2.5%, while Mining added 3.1% versus its 10-year norm of 0.9%. Weighing on the result, Agriculture contracted 0.7% against a 10-year average of 4.0% — a 4.7pp shortfall — while Health (+2.2%) and Professional Services (+1.7%) also ran materially below their historical norms of 5.1% and 4.1% respectively.
Manufacturing Growth
+3.2%
2.8pp above 10yr avg of +0.4%
Rising
Financial Services Growth
+4.9%
2.4pp above 10yr avg of +2.5%
Rising
Agriculture Growth
-0.7%
4.7pp below 10yr avg of +4.0%
Falling
GDP per Capita Growth
+1.0%
1.5pp below the 2.5% headline GDP growth rate
Stable

Population & Migration

Migration retreats from post-COVID highs as population growth moderates to 1.5%
Australia's population reached 27.8 million in December 2025, growing 1.5% over the year. Overseas migration fell 8.9% to 301,000 persons — 488.8pp below its 10-year average growth rate — while natural increase of 112,600 rose 7.9%, tracking 10.5pp above its average. WA (+2.2%) and VIC (+1.7%) lead state growth; TAS (+0.5%) lags.

Australia's population reached 27.8 million as at December 2025, growing 1.5% (approximately 417,000 persons) over the year. Growth has moderated from the post-COVID peak migration surge, with tightened visa settings reducing temporary and student arrivals. The 1.5% rate reflects a normalisation phase — overseas migration is declining while natural increase plays a proportionally larger role in sustaining population gains.
Annual population growth comprised two national components: overseas migration of 301,000 persons (-8.9% YoY) and natural increase of 112,600 persons (+7.9% YoY). Natural increase is the standout, running 10.5pp above its 10-year average growth rate of -2.6%. Overseas migration, while the dominant contributor at 301,000 persons, contracted sharply — its -8.9% growth sits 488.8pp below the 10-year average of +479.9%, reflecting the unwinding of post-COVID catch-up flows. Interstate migration nets to zero at the national level.
State population growth diverges sharply from the national 1.5% rate. WA (+2.2%), VIC (+1.7%) and QLD (+1.6%) outpace the national rate, while NSW (+1.2%), SA (+1.0%) and TAS (+0.5%) lag. In overseas migration, ACT recorded the fastest intake growth (+9.9%) and NT held positive (+2.0%), while TAS (-18.0%), WA (-13.8%) and VIC (-12.2%) saw the sharpest contractions — suggesting rental market pressures and infrastructure capacity are increasingly reshaping where migrants settle.
Natural Increase (Annual)
112,600 persons
Growth +7.9% vs 10yr avg -2.6% — 10.5pp above average
Rising
Overseas Migration (Annual)
301,000 persons
Growth -8.9% vs 10yr avg +479.9% — 488.8pp below average
Falling
Total Population
27.8 million
YoY growth +1.5%, moderating from post-COVID peak
Stable
WA Population Growth
+2.2% YoY
Fastest growing state, outpacing the national rate of 1.5%
Rising

Development Activity

Approvals surge 9.2%, but completions lag as pipeline bottleneck builds
205,200 dwellings were approved in Australia in the year to June 2026, up 9.2% YoY, 10.7pp above the 10-year average pace. Commencements (197,500, +12.1%) are accelerating faster still, but completions (172,900) fell 3.8%, signalling a delivery bottleneck. ACT (+41.9%) and Queensland (+26.5%) lead approval growth; Victoria (-1.7%) is the only state declining.

205,200 dwellings were approved in Australia in the year to June 2026, up 9.2% YoY - 10.7 percentage points above the 10-year average pace of -1.5%. Houses (+8.4% vs +0.1% average) and attached dwellings (+10.3% vs -3.4% average) are both approving well ahead of trend, with attached showing the sharper acceleration. The approvals pipeline has clearly turned higher after a soft multi-year run, now growing at a double-digit premium to its decade average.
The pipeline shows 205,200 approvals feeding through to 197,500 commencements (year to Mar-26, +12.1% YoY) and 172,900 completions (year to Mar-26, -3.8% YoY). Commencements are running 13.8pp above their 10-year average growth of -1.7%, the strongest re-acceleration in the chain. Yet completions per 1,000 persons sit at 6, versus a 7 decade average (-15.9%), and commencements per 1,000 are 7 versus 8 (-7.8%) - both below trend, with completed houses falling 4.7% YoY, pointing to a delivery-side bottleneck even as approvals and starts accelerate.
Approval growth is fastest in the ACT (+41.9%), Queensland (+26.5%) and the Northern Territory (+20.5%), while NSW (+6.0%), South Australia (+4.9%) and Victoria (-1.7%) lag, with Victoria the only state where approvals are falling. Commencement growth mirrors this: ACT leads sharply (+95.4%) ahead of Queensland (+19.8%) and SA (+15.4%), while NT (+10.4%), Victoria (+1.6%) and Tasmania (+1.3%) show muted momentum. Commercially, retail approval values lead growth at +9.7% (vs 3.0% average), office is flat at -0.3% (7.2pp below trend), and industrial (+7.9%) is decelerating from its 11.6% average pace.
Dwelling Commencements (Annual)
197.5k, +12.1% YoY
13.8pp above 10yr avg growth of -1.7%
Rising
Development Approvals - Attached
+10.3% YoY
13.7pp above 10yr avg growth of -3.4%
Rising
Dwelling Completions per 1,000
6 vs 7 avg
15.9% below the 10-year average level
Falling
Commercial Office Building Value
-0.3% YoY
7.2pp below 10yr avg growth of +6.9%
Falling

Housing Market

Regional markets surge as Australian housing affordability diverges
Capital city house prices reached $1,090,000 in Mar-26, up 9.1% YoY. Regional prices surged 11.9% to $754,000, running 4.7pp above the 10-year average of 7.2%. Capital city attached affordability is 13.5% below its historical average — the only segment tracking favourably — while regional affordability has deteriorated sharply. NT, WA, and QLD lead growth; VIC and NSW lag significantly.

The median house price across Australia's capital cities reached $1,090,000 in March 2026, up 9.1% over the year. Capital city attached dwellings rose 7.0% to $736,000, 3.7 percentage points above the 10-year average growth of 3.3%. Regional markets outperformed capitals: house prices reached $754,000, up 11.9% — 4.7pp above the 10-year average of 7.2%. Regional attached prices rose 13.9%, 6.3pp above the 10-year average of 7.6%. Growth remains elevated across all segments, with regional markets accelerating most aggressively.
Capital city attached dwellings are priced at 6.65x annual household income, 13.5% below the 10-year average of 7.69x — the only segment tracking below its historical affordability norm. At 6.65x, capital attached housing remains seriously unaffordable, yet represents relative improvement. Regional houses at 6.81x are 7.5% above their 10-year average of 6.34x, placing them firmly in seriously unaffordable territory. Regional attached at 6.42x is 11.1% above its 10-year average of 5.78x. Regional affordability is deteriorating faster than in capital cities.
Price growth is strongest in NT (+25.0%) and WA (+22.0%) for capital city houses, with QLD also elevated at +21.4%. Growth is weakest in VIC (+1.8%), NSW (+2.4%), and TAS (+3.5%). For attached dwellings, WA leads at +27.8%, QLD at +21.8%, and NT at +19.4%, while VIC is the only capital market recording price falls at -2.1%. NSW holds the highest capital city house prices at $1,490,000 and attached at $848,000, while TAS records the lowest house prices at $740,000. The growth divergence between resource-driven states and major eastern capitals continues to widen.
Regional Attached Price Growth
+13.9% YoY
6.3pp above 10-year average of +7.6%
Rising
Regional House Price Growth
+11.9% YoY
4.7pp above 10-year average of +7.2%
Rising
Attached Price-to-Income Multiple (Capitals)
6.65x income
13.5% below 10-year average of 7.69x
Falling
Regional House Price-to-Income Multiple
6.81x income
7.5% above 10-year average of 6.34x
Rising

Housing Finance

Investor lending surges 25%, powering housing finance well above trend
Housing finance commitments totalled $112.4bn in March 2026, up 8.7% year-on-year — 5.3 percentage points above the 10-year average growth rate of 3.4%. Investor lending is the standout, surging 25.0% against a 10-year average of 12.6%. ACT, TAS and NSW lead state growth while NT contracts 6.8%.

Housing finance commitments totalled $112.4bn in March 2026, up 8.7% compared to a year ago. Annual growth sits 5.3 percentage points above the 10-year average of 3.4%, indicating lending volumes are running well above trend. Housing finance has recovered firmly from the rate-driven contraction of 2022-23, with the pace of recovery accelerating into early 2026 as rate cut expectations and improved borrowing conditions support renewed demand.
Owner-occupier lending stood at $75.8bn (67.4% of total) while investor lending reached $36.7bn (32.6% of total). Owner-occupier lending grew 2.3% — modest but consistent with trend — while investor lending surged 25.0%, nearly double its 10-year average of 12.6%. Investors now account for 32.6% of new lending, with elevated activity reflecting strong rental yields and expectations of continued capital appreciation as easing monetary conditions improve return profiles.
At the state level, ACT (+14.6%), TAS (+11.6%) and NSW (+11.5%) recorded the strongest total lending growth, while NT (-6.8%) and WA (+2.8%) lagged well below the national pace. Owner-occupier trends mirror this divergence — ACT (+13.7%) and NSW (+7.6%) lead while WA (-5.7%) and NT (-11.3%) contracted outright. The concentration of growth in eastern states aligns with stronger price momentum and rental demand in those markets, where rate cuts have most improved borrowing capacity and renewed investor appetite.
Investor Lending Growth
+25.0% YoY
+12.4pp above 10yr average of +12.6% — investor activity running at twice the long-run pace
Rising
Total Housing Finance
$112.4bn
Annual growth +8.7% vs 10yr average +3.4% — lending volumes 5.3pp above trend
Rising
Owner-Occupier Lending
$75.8bn (67.4% of total)
Growth +2.3% — modest but positive; investor share (32.6%) elevated relative to owner-occupier dominance
Rising
NT Total Housing Finance (YoY)
-6.8%
Only state contracting in total lending; 15.4pp below the national growth rate of +8.7%
Falling

Rental Market

National rents rise 5.2% YoY, led by Tasmania; NSW, Victoria lag on growth.
The national median rent hit $617/wk in Sep-25 ($608 rolling-year), up 5.2% YoY. CPI Rents growth (3.8%) sits well above its 2.1% decade average, with market rents still outpacing the CPI stock measure. Tasmania (+9.6%) and Queensland (+7.3%) lead state rent growth; Victoria (+4.7%) is slowest, despite NSW holding the highest dollar rents nationally.

The national median rent stands at $617 per week ($608 on a rolling-year basis) as at Sep-25, up 5.2% YoY on the rolling measure. The latest quarter's spot growth (5.5%) runs slightly ahead of the rolling-year pace, pointing to modest acceleration rather than cooling. The 3-bed house rolling-year median has grown a similar 5.3% YoY to $591/wk, indicating the pickup is broad-based across dwelling types rather than concentrated in one segment.
Nationally, the 3-bed house rolling-year median ($591/wk) sits $60 above the 1-bed unit median ($531/wk), a gap of roughly 11%. Larger dwellings show the steepest premiums: the 4-bed house median ($691/wk) is running 50.1% above its decade average, and even 3-bed units ($803/wk) are up 31.4% on trend — an unusually wide unit premium that suggests a well-located, larger-cohort mix is driving unit rents rather than broad affordability substitution into smaller stock.
Across states, Tasmania (+9.6%), Queensland (+7.3%) and WA (+6.4%) lead rolling-year rent growth, while NSW (+6.1%), SA (+5.9%) and Victoria (+4.7%) trail — even though NSW still commands the highest dollar rents nationally at $709/wk rolling-year. Market rents (+5.2% rolling-year) continue to outrun the ABS CPI Rents measure (+3.8% YoY), itself already 81% above its 2.1% decade average, implying further upside in the CPI print as new-tenancy rent growth flows through to the broader stock.
CPI Rents Growth (YoY)
3.8%
vs 2.1% 10-yr avg (+81.0%)
Rising
4-Bed House Rent (Rolling Yr)
$691/wk
vs $460 10-yr avg (+50.1%)
Rising
3-Bed Unit Rent (Rolling Yr)
$803/wk
vs $611 10-yr avg (+31.4%)
Rising
Tasmania Median Rent (YoY)
+11.0%
fastest of any state, vs national +5.5%
Rising

Monetary & Financial Conditions

RBA cash rate steady at 4.35%; mortgage rates hold near decade highs
The RBA cash rate stands at 4.35% (Jul-26), 225bp above its 10-year average of 2.10% and steady for three months since May-26. Mortgage rates remain elevated, with the 3-year fixed rate up 14.6% YoY to 6.74% and variable rates up 7.9% YoY to 6.80%. A modestly positive yield curve signals markets expect policy stability rather than further hikes, as the tightening cycle appears to have peaked.

The RBA cash rate stands at 4.35% as at July 2026. This is above the 10-year average of 2.10%, a gap of 225bp. The cash rate has been on hold for 3 months following prior hikes, having risen roughly 50bp over the past year to reach current levels, with the Bank holding steady since May 2026 to assess the impact of prior tightening.
The average variable owner-occupier mortgage rate sits at 6.80% (Jun-26), a 245bp spread over the cash rate, up 7.9% YoY. The 3-year fixed rate is 6.74% (Jun-26), a narrower 239bp spread but up a faster 14.6% YoY. Variable borrowers face rates 165bp (31.9%) above the 10-year average of 5.15%; fixed borrowers face a wider 212bp (45.7%) premium over their 4.62% average.
The 2-year bond yield is 4.50% against a 10-year of 4.93% (week ending 1 Aug 2026), a 43bp positive spread. This modestly positive curve suggests markets expect broad policy stability rather than further tightening. Both yields remain well above history: the 10-year is 68.8% above its 2.86% average and the 2-year 103.0% above its 2.22% average.
RBA Cash Rate
4.35%
+107.2% vs 10yr avg of 2.10%
Stable
10-Year Bond Yield
4.93%
+68.8% vs 10yr avg of 2.86%
Rising
3-Year Fixed Mortgage Rate
6.74%
+45.7% vs 10yr avg of 4.62%
Rising
Variable Mortgage Rate
6.80%
+31.9% vs 10yr avg of 5.15%
Rising

FX Rates & Commodities

AUD extends gains as TWI and rural commodity prices outpace decade averages
The Australian dollar is trading at US$0.7025, up 7.7% over the year, with the trade-weighted index at 65.50 (5.5% above its 10-year average). AUD/JPY is the standout, 28.2% above its decade average at 112.9000. Rural commodity prices are growing 19.8% annually versus a 4.8% 10-year average. The trajectory points to continued AUD strength.

The Australian dollar is trading at US$0.7025 as at 1 August 2026, building on a July average of US$0.7000. The trade-weighted index stands at 65.50, 5.5% above its 10-year average of 62.06. The AUD is up 7.7% over the year against the US dollar, while the TWI has risen 8.6% year-on-year. Both measures sit well above historical norms, with the trajectory pointing to sustained strength rather than a peak.
Bilateral rates show broad AUD strength. The stand-out is AUD/JPY at 112.9000, some 28.2% above its 10-year average of 88.0500 - the widest margin of any major cross - reflecting favourable conditions for Japan-bound trade and tourism. AUD/EUR sits at 0.6100, up 7.0% over the year, supporting European trade competitiveness. AUD/CNY is 4.7342 and AUD/GBP is 0.5204 as at the latest week, both key rates for commodity-linked trade with these partners.
Rural commodity prices are growing 19.8% over the year versus a 10-year average pace of 4.8% - a 15.0pp gap that is the standout across the commodities complex. Gold has firmed to $5,848/oz, underpinning export receipts. With rural export values outpacing history and the currency already trading above its decade average on a trade-weighted basis, the terms-of-trade backdrop remains a supportive, though narrowing, tailwind for the AUD outlook.
AUD/JPY
112.9000
28.2% above 10-year average of 88.0500
Rising
Trade Weighted Index
65.50
5.5% above 10-year average of 62.06
Rising
Rural Commodity Price Growth
+19.8% y/y
15.0pp above 10-year average growth of 4.8%
Rising
Gold (AUD/oz)
$5,848
latest weekly spot, at record levels supporting export receipts
Rising

Employment

Unemployment rises above 10-year average as labour market eases
Australia's unemployment rate is 4.3% as at March 2026, above the 10-year average of 4.0% and rising 4.9% year-on-year. Unemployed persons grew 7.0%, 7.1pp above the 10-year average—the key standout. South Australia and Queensland lead employment growth; Victoria and Tasmania lag. The labour market is easing from historic lows.

The unemployment rate in Australia stands at 4.3% as at March 2026, above the 10-year average of 4.0%. The rate has risen 4.9% over the year, reflecting a gradual easing from historically tight conditions. The number of unemployed persons grew 7.0% over the year—7.1 percentage points above the 10-year average of near zero—marking a clear cyclical turning point from prior lows.
Australia employs 14.8 million persons as at March 2026, up 1.8% (266,000) over the year. Full-time employment grew 1.9% while part-time grew approximately 1.6%, with full-time positions accounting for around 73% of new jobs created. Growth remains concentrated in full-time work—a positive quality signal—even as headline unemployment drifts above its long-run average.
At the state level, Victoria records the highest unemployment rate at 4.8%, while Queensland is the lowest at 3.7%, against the national rate of 4.3%. Employment growth diverges markedly: South Australia leads at 2.6% and Queensland follows at 2.3%, while Tasmania contracted 0.6% and Victoria and ACT recorded the weakest growth at 0.7%. Queensland stands out as the only state combining the lowest unemployment rate with above-average employment growth.
Unemployed Persons Growth
+7.0% YoY
vs 10yr average of -0.1%; +7.1pp above average
Rising
Unemployment Rate
4.3% (Mar-26)
Above 10yr average of 4.0%; up 4.9% year-on-year
Rising
Full-Time Employment Growth
+1.9% YoY
Above total employment growth of 1.8%; accounts for ~73% of new jobs
Rising
State Divergence: QLD vs VIC
3.7% vs 4.8%
QLD lowest unemployment nationally and leads employment growth at 2.3%; VIC highest unemployment with weakest growth at 0.7%
Stable

Job Advertisements

Job ads fall 2.6% y/y, tracking well below the decade-average growth trend
Australian job ads totalled 620,600 in June 2026, down 2.6% y/y and 9.4pp below the 10-year average growth pace of 6.8%. Professional (181,500, -0.8%) and Industrial (128,500, +1.5%) both undershot trend by 6.8-7.0pp. SA (+2.5%) and WA (+1.5%) led state growth; ACT (-9.8%) and NT (-7.3%) lagged. The shortfall vs trend points to cooling employment momentum ahead.

Job advertisements in Australia totalled 620,600 in June 2026, down 2.6% compared to a year ago. This growth rate sits 9.4 percentage points below the decade-average pace of 6.8% per year, a sizeable shortfall. As ads lead employment by 3-6 months, the persistent undershoot versus trend signals softening labour demand ahead rather than an imminent hiring rebound.
Within the mix, Professional ads (181,500) fell 0.8% y/y, 7.0pp below their 10-year average growth pace, while Industrial/Trades ads (128,500) rose 1.5% but still ran 6.8pp under trend. Sales ads were the weakest performer relative to history, down 2.2% y/y versus a 7.1% decade-average (-9.3pp), pointing to broad-based softening across white-collar, trade and sales roles alike.
State growth diverges sharply: SA (+2.5%) and WA (+1.5%) job ads still expand above the national pace, while VIC (-3.9%), NT (-7.3%) and ACT (-9.8%) lead the decline. Professional ads echo this split, with TAS (+5.2%) and NSW (+5.0%) bucking the softness against steep falls in ACT (-9.2%) and NT (-9.5%), suggesting the labour cycle is turning faster in the smaller southern and territory markets.
Job Ads (Total)
620.6k
-9.4pp vs 10yr avg growth (6.8%)
Falling
Job Ads (Sales)
-2.2% y/y
-9.3pp vs 10yr avg growth (7.1%)
Falling
Job Ads (Professional)
181.5k
-7.0pp vs 10yr avg growth (6.2%)
Falling
Job Ads (Industrial)
128.5k
-6.8pp vs 10yr avg growth (8.3%)
Rising

Wages & Earnings

Wage growth steadies at 3.2% as full-time earnings top $109,000
Australia's WPI grew 3.2% to 160.3 in March quarter 2026, sitting 15.3% above the 10-year average level of 139.1. Full-time workers earned $2,129 per week ($109,517 annually) as at November 2025, with weekly earnings up 4.0%. ACT (+3.7%) and WA (+3.6%) led WPI growth; NT (+2.3%) lagged. Wage growth has moderated from recent highs, signalling stabilisation.

Wages grew 3.2% over the year to the March quarter 2026, as measured by the Wage Price Index, with the index at 160.3. The current level sits 15.3% above the 10-year average index level of 139.1, reflecting cumulative wage gains built across recent cycles. Wage growth has moderated from the elevated rates recorded at the post-pandemic peak, with market commentary pointing to stabilisation rather than continued escalation. At 3.2%, growth remains positive but the trajectory has clearly turned — wages appear to have passed their cyclical peak.
Full-time workers earned $2,129 per week as at November 2025, equivalent to $109,517 per year — annual earnings rose 4.2% over the year and weekly earnings 4.0%. CPI data is not provided in this dataset, so a precise real wage figure cannot be stated; however, at 4.0% nominal earnings growth, workers achieve positive real purchasing power gains whenever inflation runs below this level. Economists have noted that current wage growth, if supported by productivity recovery, is broadly compatible with the RBA's inflation framework — suggesting the wage-inflation dynamic is normalising.
On WPI growth, ACT (+3.7%), WA (+3.6%) and QLD (+3.4%) outpaced the national 3.2%, while NT (+2.3%), TAS (+2.9%) and SA (+3.1%) recorded softer growth. Notably, TAS holds the highest WPI index level at 164.1 despite ranking second-slowest for growth — its cumulative gains were concentrated in earlier cycles. On earnings, WA commands the highest weekly pay at $2,304 versus TAS at $1,890. Earnings growth rankings diverge sharply from WPI: NSW led earnings at +4.7% while WA — the top earner by level — grew just 2.6%, revealing structural divergence across wage measures between states.
Wage Price Index (Level)
160.3 (Mar-26)
15.3% above 10-year average index level of 139.1
Rising
WPI Growth (YoY)
+3.2%
Moderated from recent cyclical peak; trajectory has turned
Falling
Weekly Earnings — FT
$2,129 (Nov-25)
Up 4.0% YoY; WA highest at $2,304, TAS lowest at $1,890
Rising
Annual Earnings — FT
$109,517 (Nov-25)
Up 4.2% YoY; outpacing WPI growth of 3.2%
Rising

Household Consumption

Household spending hits $382.9bn as power costs surge 7.6pp above trend
Australian household consumption totalled $382.9bn in Mar-26, rising 5.6% over the year. Per capita spending of $13,771 sits 20.9% above its 10-year average of $11,392. Power costs are the standout essential, growing 7.6 percentage points above long-run trend while transport spending runs 14.6pp below average. Queensland and Western Australia lead state consumption growth; Victoria trails on a per capita basis.

Household consumption expenditure totalled $382.9bn in the March quarter 2026, up 5.6% over the year. Per capita consumption reached $13,771, growing 4.0% annually and sitting 20.9% above its 10-year average of $11,392. The elevated per capita level relative to the long-run average reflects cumulative price pressures and a structural lift in spending, with aggregate consumption maintaining a pace well above historical norms.
Among essentials, food expenditure reached $36.1bn, rising 4.2% over the year. Power costs are the standout essential, with growth of 12.0% running 7.6 percentage points above the 10-year average of 4.4%, reflecting persistent energy price pressures. By contrast, transport spending grew just 4.8%—14.6 percentage points below its 10-year average of 19.4%—suggesting households are curtailing mobility-related expenditure. The divergence between surging utility costs and suppressed transport spending signals a budget squeeze consolidating around non-discretionary essentials.
Queensland and Western Australia led household consumption growth at 3.1% each, while Tasmania recorded the weakest expansion at 1.8% and NSW and Victoria both grew at 2.2%. On a per capita basis, the Northern Territory recorded the highest spending at $14,079, compared to Tasmania's $11,823. Per capita growth was fastest in Queensland (+1.5%) and slowest in Victoria (+0.5%), with Western Australia's per capita gain of +0.9% notably trailing its headline growth rate—reflecting strong population intake absorbing a disproportionate share of consumption gains.
Household Consumption Per Capita
$13,771
20.9% above 10-year average of $11,392
Rising
Power Costs Growth
+12.0% YoY
7.6pp above 10-year average of +4.4%
Rising
Transport Spending Growth
+4.8% YoY
14.6pp below 10-year average of +19.4%
Falling
QLD & WA Consumption Growth
+3.1% YoY each
Fastest state growth; TAS slowest at +1.8%
Rising

Household Spending

Spending rises 5.6% as recreation surges while alcohol and dining out retreat
Australian household spending reached $240.7bn in May 2026, up 5.6% on a year ago, with per capita spending running 20.7% above its 10-year average ($34,346 vs $28,446). Miscellaneous (+9.0%) and Recreation (+7.4%) led growth well above trend, while Alcohol (-8.1%) undershot sharply. NT (+8.7%) led state growth; ACT (+3.7%) lagged.

Household spending in Australia totalled $240.7bn in May 2026, up 5.6% compared to a year ago. Per capita spending reached $34,346 annually, 20.7% above the 10-year average of $28,446 - a level that has stayed elevated even as year-on-year growth moderates from its recent cyclical peak, pointing to still-firm nominal spending capacity across households.
Food (essential) rose 5.7%, tracking broadly in line with the 5.6% headline pace. Among discretionary categories, Recreation grew 7.4% (2.3pp above its 5.1% 10-year average) and Miscellaneous 9.0% (3.7pp above average), the strongest standouts. In contrast, Hotels & Restaurants grew just 4.8% (4.1pp below its 8.9% average) and Alcohol fell 8.1% (7.8pp below its -0.3% average) - a selective pullback on dining out and drinking rather than a broad retreat.
Growth was fastest in the smaller jurisdictions - NT (+8.7%), WA (+7.3%) and TAS (+7.1%) - and slowest in the larger eastern states, led down by ACT (+3.7%), VIC (+4.1%) and NSW (+5.1%), a pattern repeated in Food spending (NT +7.7% fastest, ACT +3.5% slowest). With cost-of-living pressures still squeezing real incomes, households appear to be prioritising recreation and essentials over alcohol and hospitality.
Miscellaneous
+9.0% YoY
3.7pp above 10-year average of 5.3%
Rising
Recreation
+7.4% YoY
2.3pp above 10-year average of 5.1%
Rising
Hotels & Restaurants
+4.8% YoY
4.1pp below 10-year average of 8.9%
Falling
Alcohol
-8.1% YoY
7.8pp below 10-year average of -0.3%
Falling

Inflation & Cost of Living

Inflation holds at 3.8%, above RBA target as housing costs keep pressure high
Australia's CPI stood at 102.0 in the year to June 2026, up 3.8% annually and above the RBA's 2-3% target band. Housing (+6.8%) remains the key cost pressure, sitting well above its 10-year average level. SA and Tasmania lead state price growth (+4.2%) while Victoria trails at +3.2%. Broader commentary points to gradual disinflation, though the pace remains above target.

Inflation in Australia was 3.8% in the year to June 2026, with headline CPI at 102.0 remaining above the RBA's 2-3% target band. This extends a cycle of elevated cost-of-living pressure. Market commentary points to a gradual disinflation trend, with underlying momentum easing modestly even as annual growth stays sticky. Above-trend categories such as housing continue to keep the headline rate elevated, meaning further moderation is needed before inflation settles comfortably within target.
Housing costs (104.3) rose 6.8% annually and sit 23.8% above their 10-year average level, the clearest pressure point. Insurance & financial services (101.8) diverge furthest from trend at 26.9% above average, while health (104.6, +23.2%) and education (103.7, +21.2%) also run hot. Food-related costs (103.1) rose a more moderate 3.3% annually, tracking closer to historical norms and offering some relief against the sharper increases elsewhere.
State outcomes diverge: South Australia and Tasmania lead headline CPI growth (+4.2%), followed by NSW (+4.0%), while WA (+3.7%) and Victoria (+3.2%) trail. Housing cost growth diverges further, from Tasmania's +9.8% to Victoria and WA's +5.7%, leaving households in faster-growing states exposed to sharper cost-of-living pressure. SA also carries the highest housing cost level (105.5) against Victoria's lowest (103.2). Unless wage growth keeps pace, real purchasing power in the fastest-growing states stays under pressure.
Headline CPI (All Groups)
102.0 (+3.8% YoY)
Above RBA's 2-3% target band
Falling
Housing
104.3 (+6.8% YoY)
23.8% above 10-year average level
Rising
Insurance & Financial Services
101.8
26.9% above 10-year average level (largest gap)
Rising
Food
103.1 (+3.3% YoY)
Close to 10-year average, a relief category
Stable

Equities & Superannuation

ASX 200 at 8,967 in Jul-26 as super performance tops decade average by 34%
The ASX 200 closed July 2026 at 8,967 points, up 2.8% over the year but below the 4.9% 10-year average pace. The All Ordinaries reached 9,122 (+1.5% YoY), with total market capitalisation at $3.4 trillion (+3.9% YoY). The standout was superannuation performance, running 33.8% above its 10-year average. Capital growth is moderating from trend even as super returns accelerate.

The ASX 200 closed at 8,967 points as at July 2026, up 2.8% capital growth over the year, below the 10-year average of 4.9%. The All Ordinaries reached 9,122 points, up 1.5% YoY versus a 4.9% decade average. Total market capitalisation was $3.4 trillion, up 3.9% YoY against a 6.9% average. These are price indices measuring capital growth only, excluding dividends. The latest week (to 1 Aug) shows All Ords at 9,137 and ASX 200 at 8,977, both a touch firmer than end-July.
Superannuation continues to anchor Australia's retirement savings pool. The Superannuation Performance Index stood at $371.5bn as at July 2026, running 33.8% above its 10-year average of $277.7bn - the sharpest outperformance across the equities and super complex this period. That strength contrasts with softer capital growth in listed equities, underscoring diversified return drivers within default balanced fund allocations beyond pure index price movements.
Local capital growth trails its long-run trend across all three headline gauges, with the ASX 200 (+2.8%), All Ordinaries (+1.5%) and market capitalisation (+3.9%) all running 2-3 percentage points below 10-year averages. Superannuation's outsized 33.8% outperformance suggests fund returns are being supported by broader allocations - including offshore equities and alternatives - rather than domestic index gains alone. With All Ords and ASX 200 both firmer into early August (9,137 and 8,977), the moderation in capital growth looks more like a plateau than a reversal.
Superannuation Performance Index
$371.5bn
+33.8% vs 10yr avg of $277.7bn
Rising
ASX Market Capitalisation
$3.4t (+3.9% YoY)
-3.0pp vs 6.9% 10yr avg growth
Rising
ASX 200
8,967 (+2.8% YoY)
-2.1pp vs 4.9% 10yr avg growth
Rising
All Ordinaries
9,122 (+1.5% YoY)
-3.4pp vs 4.9% 10yr avg growth
Rising

Retail Trade

Supermarket turnover dominates at $145.6B as non-discretionary spending outpaces discretionary
Australia's retail landscape reflects entrenched consumer priorities toward essential spending amid cost-of-living pressures, with supermarket and grocery turnover reaching $145.6 billion annually through June 2025—up 137.3% from the September 2006 baseline of $61.3 billion. This non-discretionary category's dominance underscores households' focus on food and basic necessities even as discretionary budgets compress. The "Other Retail" category totaled $70.1 billion (up 160.6% from baseline), while electrical and electronics reached $26.2 billion (up 66.5%) and specialised food stores recorded $13.0 billion (up 79.9%). The divergent growth rates reveal sector-specific dynamics: supermarkets benefit from population growth and food inflation that mechanically lifts nominal turnover; electrical/electronics faces online competition and price deflation that constrains dollar growth despite volume increases; and specialised food captures premiumization trends as consumers trade up to artisan bakeries, butchers, and organic retailers. Retail patterns demonstrate the squeeze on household budgets—necessities claim growing wallet share while discretionary categories face volume pressure. The data encompasses both in-store and online sales, with e-commerce penetration varying dramatically by category and reshaping traditional retail economics.

Supermarket and grocery turnover reached $145.6 billion on an annual rolling basis through June 2025, representing 137.3% growth from the September 2006 baseline of $61.3 billion. This substantial nominal expansion stems from three reinforcing factors: population growth of approximately 30% over the period mechanically increased the customer base; food price inflation substantially outpaced general CPI, with fresh produce, meat, and packaged goods all experiencing multi-decade price increases; and consumption patterns shifted toward eating at home rather than dining out as restaurant prices surged and household budgets tightened. The absolute turnover figure of $145.6 billion translates to roughly $5,300 per capita annually in supermarket spending, highlighting groceries' substantial claim on household budgets. Market concentration in this sector proves extreme, with Woolworths and Coles commanding approximately 65-70% combined market share, followed by Aldi, IGA, and smaller independent operators. This duopoly structure generates ongoing political and regulatory scrutiny around pricing power, supplier treatment, and consumer choice—particularly during periods of elevated food inflation when margin expansion attracts criticism. The pandemic accelerated online grocery adoption, with click-and-collect and home delivery services now comprising an estimated 10-15% of supermarket sales compared to minimal penetration pre-2020. However, the high costs of online fulfillment—picking, packing, refrigerated transport—squeeze margins and raise questions about long-term profitability of digital grocery channels at current pricing.
Electrical and electronics retail turnover totaled $26.2 billion annually through June 2025, up 66.5% from the September 2006 baseline of $15.7 billion—the weakest growth rate among major retail categories despite technology's increasing importance in daily life. This subdued nominal growth masks dramatic volume expansion: Australian households purchased vastly more devices, appliances, and electronics over the period, but unit prices declined sharply due to manufacturing efficiency gains, technology commoditization, and intense online competition. Categories like televisions, computers, and smartphones saw 50-80% price deflation over the past two decades even as specifications improved dramatically, creating a headwind for dollar turnover growth. The "Other Retail" category reached $70.1 billion, up 160.6% from the $26.9 billion baseline—a broad bucket encompassing clothing, footwear, furniture, homewares, sporting goods, and various specialty retail segments. This category's strong nominal growth reflects both population expansion and premiumization trends in segments like activewear, furniture, and homeware where consumers traded up to higher-quality products. However, the aggregate figure conceals sharp divergence: fast fashion and discretionary apparel faced margin pressure and market share loss to online competitors, while furniture and homewares benefited from pandemic-era nesting behaviors and sustained housing market activity that drove demand for furnishings and renovations. Specialised food retail—artisan bakeries, butchers, delis, organic grocers—recorded $13.0 billion in turnover, up 79.9% from $7.2 billion, capturing the premiumization of food consumption as higher-income households sought quality, provenance, and specialty products beyond supermarket offerings.
The retail sector's compositional dynamics reveal broader shifts in consumer behavior, household budget allocation, and competitive landscapes. Supermarkets' commanding 60% share of the captured retail categories ($145.6B of ~$255B total) reflects food's non-discretionary status and limited substitution possibilities—households must eat regardless of economic conditions, providing grocery retailers with defensive earnings characteristics. The weak electrical/electronics growth despite technological proliferation demonstrates how price deflation can overwhelm volume gains, creating challenging economics for bricks-and-mortar retailers competing against online pure-plays with lower overhead structures. Amazon's entry into the Australian market intensified this pressure, forcing incumbent retailers to match prices while bearing higher cost structures—Officeworks, JB Hi-Fi, and Harvey Norman all faced margin compression as they invested in online capabilities and price competitiveness. The rise of specialised food retail signals income polarization: higher-earning households increased spending on premium food experiences and artisan products, supporting independent retailers and niche chains, while cost-conscious households concentrated spending at discount supermarkets and focused on value. Per-capita retail spending growth substantially lagged income growth over the period, indicating declining retail share of household budgets as housing costs, utilities, and services claimed increasing portions of disposable income. Looking forward, retail faces persistent headwinds from elevated mortgage servicing costs that suppress discretionary spending, ongoing e-commerce penetration that advantages low-cost operators, and potential consumption weakness if labor market softening reduces income growth. The essentials-focused spending pattern appears entrenched, with supermarkets likely maintaining dominance while discretionary categories face volume pressure absent meaningful real income growth that restores household purchasing power.
Supermarket and grocery turnover
$145.6B annually
+137.3% from 2006 baseline, dominates retail landscape
Strong
Electrical/electronics growth
+66.5% since 2006
Weakest growth despite tech proliferation—price deflation overwhelms volume gains
Constrained
Other retail category
$70.1B annually
+160.6% from baseline, but conceals divergence between winners and losers
Mixed
Specialised food retail
$13.0B annually
+79.9% from baseline, premiumization trend among higher-income households
Rising
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