The Commonwealth Bank of Australia is using Google search activity to help it forecast household spending trends.\nThe bank\u2019s new Household Spending Intentions Series combines its own data \u2013 which is \u201cone of Australia\u2019s largest financial data sources\u201d the bank said \u2013 with relevant, publicly available search data from Google.\n\u201cEmploying near real-time spending readings from CBA\u2019s household transactions data and combining them with relevant search information fromGoogle Trendswas used to map the data results on consumer spending,\u201d the bank said.\n\u201cThese searches provide insights into what consumers are doing\/researching on the Internet and what their spending intentions are,\u201d it added.\nThe approach to forecasting uses spending data derived from a sample of more than 2.5 million households who are CBA customers. The bank made decisions about what Google search terms to investigate that \u201cpass the pub test as well as meet the more rigorous statistical standards\u201d.\nThe bank\u2019s economists used Google Correlate to match the economic data to search patterns.\nNot all patterns were relevant, the bank states in the report, for example Google Correlate found that searches for \u2018green bean casseroles\u2019 were strongly correlated with house sales with a three month lead.\n\u201cWe could posit that those thinking about buying a house are busy saving the deposit and looking for inspiration for a cheap meal. But in the end correlation does not mean causation. We should keep looking for more relevant search terms,\u201d the report says.\n\u201cInstead, combining CBA loan application data with relevant Google searches generates a home purchase intentions indicator that leads the actual sales data by four months. The statistical metrics are quite good \u2013 the correlation coefficient comes in at 0.83,\u201d the report explains.\nThe Household Spending Intentions reports are intended for use by small and large businesses, policy makers and investors. They will be published monthly to help Australians \u201cstay ahead of emerging economic trends\u201d said CBA chief economist Michael Blythe.\n\u201cHouseholds are the dominant part of the economy and drive much of its activity and volatility \u2013 anything that gives an early warning sign on how the consumer is behaving is very useful,\u201d Blythe added.\nThe reports focus on seven areas of consumer spending: retail, travel, health and fitness, entertainment, education and motor vehicles. These areas cover about 55 per cent of total consumer spend.\nCombining the bank\u2019s data with Google\u2019s enable\u2019s CBA to predict purchase activity up to four months in advance.\nIn this first report, the bank found that overall, household spending intentions remains negative.\n\u201cWeakness persists in the dominant retail and motor vehicle sectors. But other sectors appear to be bottoming out \u2013 including travel and entertainment, or picking up \u2013 including health and education. The turn in home buying intentions is particularly noticeable in recent months,\u201d Blythe said.