Western Australia had the fourth largest drop in household spending.
New data from the Australian Bureau of Statistics has revealed household spending fell 0.4 per cent during December, reversing the trend of spending increases observed during the latter months of last year.
ABS data released today revealed the fall, with the ABS emphasising spending was still up five per cent compared to December 2024.
Bureau head of business statistics Tom Lay said high spending in October and November, spurred by major sales and cultural events, also put the December result into context.
"The fall in December indicates that households brought forward purchases during sales events in October and November," he said.
"These falls were across a range of categories including discretionary items such as electronics, clothing and furniture, as well as essential items like healthcare.
"Health spending declined this month (December) after several months of growth, partly due to higher bulk-billing rates reducing out-of-pocket costs for households."
According to the data, higher spending on new vehicles helped offset declines observed across clothing and footwear (down 2.4pc); furnishings and households equipment (down 1.7pc); and health (down 1.3pc)
Last Updated: 9 February 2026
Western Australia had the fourth largest drop in household spending (0.3pc down).
The largest drop was observed in Victoria (1.0pc down); followed by New South Wales (0.6pc down) and the nation's capital (down 0.4pc).
In its statement, the ABS said spending may be higher than are presented in official results because of the growing prevalence of the illicit tobacco trade.
"Monthly and quarterly movements are derived using data on legal sales of cigarettes and tobacco at supermarkets," the statement said.
"Sales of illicit tobacco are not included. With the rise of illicit tobacco sales over the past few years, MHSI estimates pf cigarettes and tobacco have fallen sharply, detracting from overall growth.
"We estimate that household spending volumes rose 1 per cent in the December quarter 2025 if cigarettes and tobacco spending was included. Over the past two years, cigarettes and tobacco spending has detracted around 0.2 percentage points per quarter from total household spending."
Despite the drop off in spending amounts, the household spending volume indicator rose for the sixth consecutive quarter.
"Discretionary categories such as clothing and footwear and furnishings and household equipment drove the rise, up 4.1 per cent and 3.6 per cent in December," Mr Lay said.
Household spending volumes for the 12 months to December rose 2.4 per cent, the strongest annual growth recorded in the year.
