Following a 0.1 per cent fall in retail spending in April, ANZ Bank economist Aaron Luk expects to see a 0.2 per cent rise in May figures released by the Australian Bureau of Statistics on Wednesday.
"We expect a modest recovery in clothing sales this month and food-related spending is expected to continue its upward trajectory," Mr Luk said.
Even accounting for the weather-impacted 2.5 per cent drop in clothing sales in April, the Australian consumer has experienced a subdued start to 2025, despite falling inflation and interest rates boosting disposable income.
Consumer sentiment was hit by global uncertainty stemming from Donald Trump's threatened trade war and although tensions are now easing, confidence remains muted.
Elsewhere, Australia's never-ending wealth-creation engine powers on, with home prices likely to show further growth in Cotality's home value index report on Tuesday.
The housing analytics firm formerly known as CoreLogic has tracked a rebound in property values since the start of the year, following a brief late 2024 downturn.
Median dwelling prices hit a record high in June, with the median home in Australia now worth more than $830,000.
AMP chief economist Shane Oliver expects another 0.6 per cent increase in July, up from 0.5 per cent growth the month prior.
Slower-than-expected inflation figures released last week bolstered the case for the Reserve Bank to cut interest rates again in July, which would further fuel housing demand and price down the track.
That's bad news for Australians hoping to clamber onto the property ladder, who can at least be consoled that dwelling approvals are tipped to recover from two consecutive months of falls.
A 4.9 per cent jump in housing consents is expected to be revealed by the ABS on Wednesday.
New supply is desperately needed to meet growing demand, but the pipeline is still well short of the levels needed to meet the national housing accord target of 1.2 million new homes by 2029.
To meet that figure, Australia would need to build 20,000 new homes a month and the industry is already behind.
In April, only 14,633 new homes were approved.
Meanwhile, appetite for risk among Wall Street investors is being fuelled by data solidifying expectations of rate cuts by the Federal Reserve.
Despite President Donald Trump terminating trade negotiations with Canada in response to its digital tax on technology companies, all three major US indexes posted weekly gains.
The Dow Jones rose 432.43 points, or 1.00 per cent, to finish Friday at 43,819.27, the S&P 500 gained 32.05 points, or 0.52 per cent, to 6,173.07 and the Nasdaq Composite gained 105.55 points, or 0.52 per cent, to 20,273.46.
Australian share futures crept up 5 points, or 0.05 per cent, to 9,316.
The benchmark S&P/ASX200 gave up modest morning gains on Friday to finish on the lows of the day, losing 36.6 points, or 0.43 per cent, at 8,514.2.Â
The broader All Ordinaries fell 29.9 points, or 0.34 per cent, to 8,743.7.
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