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Holiday spending stunted by Omicron

  • January 10 2022
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Holiday spending stunted by Omicron

By Jon Bragg
January 10 2022

Spending in the week after Christmas fell as much as 25 per cent.

holiday spending stunted by omicron

Holiday spending stunted by Omicron

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  • January 10 2022
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Spending in the week after Christmas fell as much as 25 per cent.

holiday spending stunted by omicron

The spread of the Omicron variant of COVID-19 may have driven a significant reduction in spending across the country during the new year break.

Data released by ANZ indicated that overall spending in NSW in the week to 2 January was down 25 per cent compared to a year earlier, the biggest drop among all the states.

A fall of 19 per cent was recorded in Victoria and 17 per cent in Queensland, while spending in all other states fell by 15 per cent.

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“The drop in spending after the key Christmas and Boxing Day trading was much sharper this year than in previous years,” said ANZ senior economist Adelaide Timbrell.

Dining and travel, particularly in Sydney and Melbourne, were among the most impacted spending categories towards the end of 2021.

The bank also found that online shopping had offset some of the impacts of Omicron.

“Higher rates of online spending, particularly for dining, show that both businesses and households are adjusting to iterative lockdowns, movement restrictions and COVID transmission caution by moving more spending online,” said Ms Timbrell.

“This could reduce the impact of iterative lockdown and movement restrictions in 2022 and may be behind Victoria’s smaller fall in spending in late 2021 compared with NSW, since Victorian businesses have more experience with lockdowns.”

Spending on key holiday shopping dates, including Christmas Eve, Black Friday and Cyber Monday, was lower than 2020 but remained above pre-COVID levels, according to ANZ.

Christmas Day spending increased slightly compared to previous years, while spending on Boxing Day fell for the second year in a row.

“Boxing Day sales are likely to keep falling as more households move their end of year sales spending to Black Friday,” noted Ms Timbrell.

The Commonwealth Bank previously forecast that $4 billion would be spent during the Boxing Day sales, while the Australian Retailers Association and Roy Morgan expected a total of $21 billion would be spent between Boxing Day and 15 January.

Holiday spending stunted by Omicron
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