Card spending falls in November amid earthquake disruption

Retail spending on electronic cards fell in November, snapping two consecutive months of gains, amid disruption from the Kaikoura earthquake.

Retail spending dropped a seasonally adjusted 0.3% last month, after a 0.6% gain in October and a 2.1% rise in September, Statistics New Zealand says.

Actual retail spending climbed 5.1% to $5.2 billion in November from the same month a year earlier..

Core retail spending, which excludes vehicle-related industries, dropped 0.4% in November from October, with apparel spending down 3.2%, its biggest monthly drop since a 3.5% decline in July 2013.

Spending on durables fell 0.7%, and hospitality dropped 0.3%, while consumable spending bucked the trend, up 0.8%.

The statistics agency says it isn't yet sure how sales may have been affected by the Kaikoura earthquake, which caused ongoing disruption in central Wellington.

"Spending growth took a small step back in November, but given the month contained the North Canterbury earthquake, this is no great surprise," ASB economist Daniel Snowden says in a note.

"As well as spending being directly impacted in the quake-affected areas, there is also potential for distribution disruption, impacting spending in non-quake impacted areas."

Mr Snowden says he expects future spending growth to remain firm, supported by high net migration, recovering dairy prices and record low interest rates.

Of the non-retail industries, non-retail excluding services fell 1.4% from October while spending in the services industry declined 2.3%.

Spending on fuel rose 2.5%, while vehicle spending slipped 2.8%.

In actual terms, card-holders made 138 million transactions in November with an average value of $50. The total amount spent was $6.9 billion.

(BusinessDesk)

Tina Morrison
Fri, 09 Dec 2016

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Card spending falls in November amid earthquake disruption