Shoppers in Australia will spend an additional $9 billion during the final week before Christmas, according to the re-forecast by the Australian Retailers Association (ARA), in conjunction with Roy Morgan.

This will bring spending for the November-December 24 trading period up to $67.4 billion, an increase of 1 per cent from last year.

Across the pre-Christmas period, food spending is expected to reach $27 billion, up 3.2 per cent from last year. Meanwhile, sales of household goods and hospitality will drop 3 per cent and 1.5 per cent, respectively, due to cost-of-living pressures.

All states and territories are set to record year-on-year sales increases, led by South Australia with sales up 2.6 per cent.

“November trading by all accounts appears to have been strong, despite cost-of-living pressures, as shoppers capitalised on unprecedented deals and sales to tick off their Christmas lists early, and this has helped prop up our Pre-Christmas projections somewhat,” said ARA CEO Paul Zahra.

However, the ARA is anticipating a “subdued Christmas” overall.

“The slight increase in spending this year is being inflated by unavoidable supply chain price increases, particularly in food, and an overall increase in Australia’s population. If you exclude these factors, overall Christmas spending is in decline,” Zahra explained.

“For most discretionary retailers, up to two-thirds of their profit is made during the all-important Christmas trading period, so December remains a period of uncertainty.”