Household spending over 6 percent down in July

As indicated by the CBS Household Consumption Radar, circumstances for consumer spending in September are less unfavourable than they were in July.

Consumption figures have been adjusted for price changes and differences in the shopping-day pattern.

Lower spending on services

In July, consumers spent 14.9 percent less on services than in the same month last year. This mainly applied to e.g. restaurants, hairdressers, theatres, gyms and football games as well as public transportation. However, consumers spent more on services such as telephone and internet subscriptions, insurances, housing services, private lease and courier services.

Consumer spending on durable goods increased by 9.8 percent. They mainly spent more on electrical appliances, home furnishings and cars compared to July 2019. Consumer spending on food, beverages and tobacco was 1.8 percent up year-on-year. Spending on other goods, such as natural gas and motor fuels was 3.1 percent up.

Three weeks ago, CBS reported a year-on-year turnover growth in retail trade of 9.7 percent in July 2020. The volume of sales increased by 7.1 percent. Turnover was up in both the food sector and the non-food sector. These figures as well were adjusted for the shopping-day pattern.

Conditions less unfavourable in September

Every month, CBS publishes indicators to show developments around household consumption in the CBS Household Consumption Radar. Household consumption is influenced by factors such as consumers’ expectations, their personal financial situation and developments on the labour market. Although the Radar indicators show a strong correlation with household consumption, improved circumstances are not necessarily translated into increased growth.

According to the CBS Household Consumption Radar, circumstances for household consumption in September are less unfavourable than in July. This is mainly due to the less negative mood among Dutch manufacturers regarding future employment growth within the company. Consumers’ expectations on their own financial future were also less negative.