The Commonwealth Bank of Australia has analysed its customers’ behaviour from transaction data and considered it alongside the prevalence of household spending intentions found in Google Trends search data.

According to the bank, the spike recorded for google search activity on “tax refunds” in July 2019 was the largest recorded in the last five years.

CBA chief economist Michael Blythe noted the levelling out of recent household spending intentions readings offers encouraging, albeit tentative, signs that tax rebates are now being paid to households and it is boosting disposable income.

The result? This disposable income flows through to household spending intentions.

“HSI measures provide a glimmer of hope that the outlook for consumer spending is slowly improving,” he commented.

“The improvement is modest, but the switch from downward signals to something that is more flat-to-up offers some hope that the second half of 2019 will be better for the consumer than the first half of the year.”

According to the chief economist, “much will depend on the impact of the tax rebates that households are receiving”.

“Many of these payments are large and are flowing into CBA customer accounts right now,” Mr Blythe continued.  

He reported that the value of tax refunds in July was 49 per cent above “normal” levels.

“The turn in the housing market is also helping. The drag on consumer spending from a negative ‘wealth effect’ should be receding as dwelling prices stabilise or lift,” the economist said.