And while many households still went out for dinners and entertainment, spending growth in these areas fell from around 3 per cent in 2017 to close to 1 per cent last year. While we know that higher interest rates play an important role in these declines, there are other influences as well: 1. The first is income effects.
As the prices of some of the products we export—such as oil— decline, it reduces our national income. Oil and other commodity prices retreated over 2018. And disposable income, which grew at a pace of 4½ per cent in 2017, slowed to about 3½ per cent last year. 2.