Spending fell for the first time in 13 months in September, but consumer confidence is expected to pick up in following months.

Economywide spending was down 1.4 per cent in September, seasonally adjusted, according to the Commonwealth Bank’s Business Sales Indicator (BSI), after a 2.5 per cent rise in August.

The annual growth rate eased to 5.3 per cent in September, from 12 per cent the month before.

CommSec chief economist Craig James said the fall in spending coincided with a boost in housing data.

“Perhaps Aussie consumers were too busy at home auctions or sprucing their homes up for sale, but the evidence suggests that fewer people were at shopping malls or generally spending their money,” he said.

“But with the election out of the road, the US budget and debt issues solved for now, consumer confidence lifting and with key sharemarket indexes at record highs, economywide spending should lift in coming months.

Mr James said the Reserve Bank of Australia would be watching economic data from the non-mining parts of the economy particularly closely.

“If spending doesn’t lift, and at the same time if inflation is contained and the Aussie dollar lifts, then the Reserve Bank will be tempted to cut rates,” he said.

“Much will depend on the housing market. If demand for homes remains strong then the Reserve Bank will be reluctant to cut rates again.”

The RBA’s cash rate is currently at a record low of 2.5 per cent, after the bank reduced it by quarter of a percentage point in May and August.

The BSI tracks debit and credit card transactions at the Commonwealth’s point of sales terminals.

AAP