Despite three interest rate cuts since May, consumers aren't spending any more than they were five months ago.
The Commonwealth Bank's Business Sales Indicator shows consumer spending dropped 1.2 per cent, seasonally adjusted, in October, after jumping 3.9 per cent the month before.
CBA local business banking executive general manager Adam Bennett said the trend over the past five months had been virtually flat.
"Over the past five months, solid monthly gains have been exactly offset by losses, creating inconsistent and challenging operating conditions for businesses," he said.
But, he said, spending was still up 6.2 per cent compared to a year ago.
Commsec chief economist Craig James said the BSI showed consumer sentiment remained subdued.
"Aussie consumers are still spending, but very selectively, as evidenced in mixed spending results across sectors," he said.
He said the global financial environment would need to improve for consumers to spend more in the lead-up to Christmas.
The BSI, which tracks the value of credit and debit card transactions processed through Commonwealth Bank point-of-sale terminals, showed the strongest improvement in spending in October occurred in the Automobiles & Vehicles sector (up 0.7 per cent).
Service Providers (down 4.6 per cent), Mail Order & Telephone Orders Providers (down 4.1 per cent), and Hotels & Motels (down 0.9 per cent) were among the weakest sectors.