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Only those aged 65 or more recorded spending that outpaced the rate of inflation, an unusual reversal of the normal historical caution displayed by older consumers.
This can be explained by the fact that younger people have suffered the biggest hits to spending power, with mortgages, rents and federal government tax “bracket creep” constraining their ability to put money into other things, says CBA economist Gareth Aird.
“If you generalise, older people don’t have mortgages,” he says. “A lot of people in that age bracket aren’t renting, so they haven’t been hit through rate hikes in a material way, they haven’t been hit through bracket creep. A lot of people on the aged pension have seen the pension indexed to reflect inflation, and all those with deposits are getting a higher return than previously,” he says.

“The story in all of this is that, through the various levers that have been pulled to get inflation down, they’ve landed hardest on those with mortgages and on renters.
“That picture will start to change when the RBA is finally able to ease, but we’re not there, so I wouldn’t expect these trends to shift in the short-run.”
Both here and abroad, that lop-sided consumer picture – increasingly driven by the shift to retirement of the demographic “Boomer” bulge made up of people born between 1946 and 1964 – is complicating the inflation-fighting challenges faced by central banks, and adding to budget policy headaches for Treasurer Jim Chalmers.
At the political level, it could ultimately reignite intergenerational conflict, providing fresh fuel to advocates of greater taxation of wealthy retiree savings to ease the burden on younger taxpayers.
Labor tried to tackle intergenerational inequity in the 2019 election and ended up triggering the wrath of older voters when it promised to introduce changes to franking credits, a key reason Bill Shorten lost to Scott Morrison.
While Chalmers has no political appetite to go there again – notwithstanding last year’s still-to-be legislated promise to double the tax paid on earnings on superannuation balances above $3 million – the issue of how different generations bear economic burdens could erupt anew as the spending differentials get worse.