CBA spending, BBN, and consumer confidence


Spending intentions are down but yet to “hard stop”, which is what we expect as rates bite.

Despite sounding like a broken record, we just can’t go and buy consumer discretionary/retail when we think a large slowdown is coming.

Baby Bunting

A casual glance at the BBN forecast NPAT (which increases)…

…versus the trading update in which quarterly profits on PCP appear to be down (a decrease)…

…explains the share price weakness today. As per our note above, we do expect spending at the household level to decrease. BBN is probably not what we have in mind, but it still points to households being price sensitive, which producers are responding to, leading to increased competition.

Consumer confidence

It is still bleak out there by reported emotion, but actual spending remains high (as we saw with both retail sales and the CBA intentions). Falls are, however, coming.

Important Information: This document has been prepared by Aequitas Investment Partners ABN 92 644 165 266 (“Aequitas”, “our”, “we”), a Corporate Authorised Representative (no. 1284389) of C2 Financial Services, (Australian Financial Services Licensee no. 502171), and is for distribution within Australia to wholesale clients and financial advisers only.

This document is based on information available at the time of publishing, information which we believe is correct and any opinions, conclusions or forecasts are reasonably held or made as at the time of its compilation, but no warranty is made as to its accuracy, reliability or completeness. To the extent permitted by law, neither Aequitas nor any of its affiliates accept liability to any person for loss or damage arising from the use of the information herein.

Please note that past performance is not a reliable indicator of future performance.

General Advice Warning: This document has been prepared without taking into account your objectives, financial situation or needs, and therefore you should consider its appropriateness, having regard to your objectives, financial situation and needs. Before making any decision about whether to acquire a financial product, you should obtain and read the relevant Product Disclosure Statement (PDS) or Investor Directed Portfolio Service Guide (IDPS Guide) and consider talking to a financial adviser.

Taxation warning: Any taxation considerations are general and based on present taxation laws and may be subject to change. Aequitas is not a registered tax (financial) adviser under the Tax Agent Services Act 2009 and investors should seek tax advice from a registered tax agent or a registered tax (financial) adviser if they intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise, or could arise, under a taxation law.

Receive our investment insights

Something went wrong. Please check your entries and try again.