Benjamin Teo
Updated on August 12th, 2025
Father’s Day in Australia has been a reliable retail boost, but spending has slipped for two years in a row since its 2022 peak. Rising living costs and softer consumer confidence have kept gift budgets tight — and now, with the Reserve Bank of Australia lowering the cash rate to 3.60% on 12 August 2025, there’s fresh speculation about whether the extra breathing room could help steady sales this September. This article looks at where spending has been, what shoppers are buying, and how the latest economic shift might shape 2025.
What changed this week?
- RBA cut the cash rate by 0.25pp to 3.60% (Aug 12, 2025).
- Major banks began passing on cuts, easing mortgage pressure ahead of Father’s Day.
Father’s Day Spending from 2017 to 2024
Australian Father’s Day gift spending has experienced considerable volatility over the past seven years, marked by a distinct peak followed by consecutive declines. The pre-COVID period (2017-2022) saw spending reach $768 million in 2017, before dipping to $735 million during the pandemic years of 2020-2021. However, 2022 marked a substantial recovery, hitting a high of $872 million, the highest recorded level. This surge might have been influenced by a post-lockdown desire to celebrate and make up for previous subdued festivities.
Australian Father’s Day Total Spending (2017–2024)
Following this peak, a consistent downward trend began. In 2023, total expenditure softened to $860 million, representing a 1.3% decline from the previous year. This downward momentum accelerated into 2024, with spending falling further to $820 million. This marked a 3.5% decrease from 2023 and a more significant 6% decline from the 2022 peak.
Budgets Tighten as Well as Participation
The decline in overall spending isn’t simply due to fewer people participating; it also reflects individuals spending less per gift. The average expenditure per gift-buyer has steadily decreased: from $113 in 2022, it dropped to $112 in 2023, and then notably to $101 in 2024. This represents a significant 9.8% year-over-year decline in individual spending.
While the proportion of Australians planning to purchase Father’s Day gifts has slightly dropped from 36% in 2022 to 35% in 2023, the more impactful trend is the reduced budget per person. Although more than 8 million Australians were expected to buy gifts in 2024, their financial commitments were notably lower compared to previous years.
Average Father’s Day Spend Per Person
The data presented in this article is derived from comprehensive research, including consumer surveys (such as those conducted by the Australian Retailers Association (ARA) and Roy Morgan, which capture intended gift purchases) and transactional data (such as that provided by major financial institutions like ANZ, measuring actual total spending behaviour). Both methodologies offer valid and complementary perspectives on Father’s Day expenditure.
Cost-of-Living Still the Key Pressure
The most significant factor unequivocally driving this spending decline is Australia’s persistent cost-of-living crisis. Industry leaders have consistently highlighted this as the dominant cause, noting that “many households continuing to feel the cost-of-living crunch” has directly impacted Father’s Day spending patterns. The Aug 12 cash rate cut to 3.60% may ease mortgage pressure, but its effects are unlikely to be felt immediately in discretionary categories like gifts.
Evidence supports this, with research indicating that 42% of consumers planning Father’s Day purchases in 2022 already reported that cost-of-living challenges would influence their spending decisions. Given the ongoing economic conditions, this percentage has almost certainly risen in subsequent years, leading to a tightening of belts for non-essential purchases like gifts.
Several interconnected economic factors have amplified this pressure, curbing discretionary spending:
- Interest Rate Impacts: Multiple interest rate hikes by the Reserve Bank of Australia (RBA) have placed considerable financial strain on mortgage holders, reducing their available income for discretionary spending.
- Inflation Pressures: The rising cost of essential goods and services across the board has eroded household purchasing power, leaving less room for gifts and celebrations.
- Consumer Confidence: A general decline in consumer sentiment reflects widespread economic uncertainty, making Australians more hesitant to spend on non-essential items.
What Are We Buying? Gift Category Analysis
Despite the overall spending decline, specific gift categories maintain their popularity, offering insights into consumer preferences and budget adjustments:
Top Father’s Day Gift Categories (2024)
While these categories dominate, the real question is whether any uplift in discretionary budgets — potentially aided by interest rate relief — will lead to higher volumes or just sustain current buying patterns.
Regional Spending Differences and Early Bird Shoppers
Father’s Day spending isn’t uniform across Australia, with significant variations observed between states and territories. In 2023, Tasmania ($204) and Queensland ($168) recorded the highest per-capita spending. Conversely, cost-of-living pressures were more acutely felt and reflected in lower spending in South Australia ($69), Victoria ($80), and Western Australia ($82).
A notable and growing trend is consumers purchasing Father’s Day gifts earlier to leverage sales and promotions. In 2024, approximately 800,000 Australians, representing 10% of gift purchasers, took advantage of mid-year sales to buy presents in advance, collectively spending $75 million. This indicates a strategic shift as consumers become more budget-conscious and actively seek ways to maximise value.
States with heavier mortgage debt — such as NSW and VIC — could benefit more quickly from the RBA’s August cut.
2025 Outlook: Cautious Optimism
The outlook for Father’s Day spending in 2025 appears to be cautiously optimistic, with several economic indicators pointing towards a potential, albeit modest, recovery.
What is consumer confidence? It measures how optimistic people feel about the economy and their finances. High confidence leads to more spending, while low confidence leads to cutbacks.
What is the discretionary spending index? It tracks how much people spend on non-essential items like gifts, dining, and entertainment. A drop usually signals tighter household budgets.
Economic Recovery Indicators:
- Interest Rate Environment: The RBA began cutting interest rates in February 2025, reducing the cash rate to 4.1%. Economic forecasts anticipate three additional rate cuts throughout 2025, potentially reaching 3.10% by year-end. These reductions are expected to provide significant relief to mortgage holders, thereby increasing their disposable income.
- Consumer Confidence Recovery: Consumer confidence reached a three-year high at the beginning of 2025, with the Consumer Confidence Index rising to 87.5 . This improvement signals growing optimism about personal financial situations and a greater willingness to spend.
- Economic Growth Projections: Australia’s economy is projected to grow by 2.1% in 2025, spurred by easing inflation and anticipated interest rate cuts. This broader economic uplift will likely translate into stronger retail sales, particularly in discretionary categories.
Spending Recovery Indicators: Recent data suggests that discretionary spending is indeed beginning to recover. A key index for discretionary spending categories, including retail and entertainment, recorded a positive reading of 101.6 in March 2025. Furthermore, Australian retail spending has shown consistent growth, with March 2025 recording a 4% increase compared to the same month in 2024. Consumer sentiment regarding major purchases has also improved, with 28% of Australians now believing it’s a good time to buy major household items, an increase from previous periods. This shift in purchasing attitudes could positively impact Father’s Day spending.
Factors Shaping 2025 Father’s Day Spending
Forecast: 3.10%
(3-year high)
(June 2025)
Based on these converging economic indicators and consumer confidence trends, Father’s Day spending in 2025 will likely show a modest recovery compared to 2024. The combined effects of interest rate relief, improving sentiment, economic stabilisation, and early signs of discretionary spending recovery support this view. However, the rebound is expected to be gradual rather than sharp. Consumer sentiment is forecast to peak just below neutral at 97 in Q3 2025, signalling cautious optimism rather than exuberance.
Markets expect the cash rate to ease further—perhaps toward **3.1%** by late 2025—yet such effects on household spending tend to lag. (NAB now predicts cuts through to year-end, Westpac sees similar moves)
So What’s The Outlook?
While buying gifts for dad on Father’s Day has clearly declined since its 2022 peak, with back-to-back drops in 2023 and 2024, economic pressures and lower consumer confidence have played a major role. In 2025, signs are pointing to a slow but steady recovery. Interest rate cuts and improved sentiment could lead to a slight lift in spending, though shoppers are expected to stay cautious. For retailers, offering good value and running early promotions will be key to staying relevant in a more price-sensitive market.
Whether that means 2025 avoids a third consecutive drop will depend on how quickly households feel the benefits of the latest rate cut — a change that often takes months to influence actual spending.
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The original DadShop writer, owner, fun loving and tech guy. Great with computers, gadgets, quick on his feet and lover of novelty gifts. Ben writes for our wonderful blog occasionally just to pass time.
