Retail spending declines as hospitality, durable goods sales dip
Softening in spending levels and the housing market to blame.
New Zealand retail spending on electronic cards edged lower in August as expenditure on eating out and durable household items dipped.
Retail spending on credit and debit cards decreased 0.2% in seasonally adjusted terms from July, having fallen 0.5% that month, Statistics NZ said in a statement. Total spending, including non-retail industries, increased 0.6% in August from a month earlier.
"In part, this subdued growth in spending levels reflects the softness in prices, particularly for imported consumer goods," Westpac Banking Corp senior economist Satish Ranchhod said in a note. "However, it's likely that the softening in the housing market is also playing a role in depressing household spending."
Consumer confidence has remained relatively upbeat this year as a strong labour market and recovery in dairy prices kept household incomes stable, while weaker retail spending in recent months has largely been due to cheap fuel as a relatively strong New Zealand dollar and weak global oil prices kept a lid on prices at the pump.
Today's figures show credit and debit card spending on fuel rose 0.4% in August, snapping five months of declines, while hospitality decreased 0.1%, following a 0.8% fall in July.
Spending on durables slipped 0.1%, its first decline in five months, while expenditure on consumables rose for a third month, up 0.2%. Vehicles spending rose 0.9% in August, its third gain in a row.
Westpac's Ranchhod said he expects moderate spending growth in the coming months, with the "slowdown in the housing market a key drag."
Today's figures show actual retail spending climbed 4.4% to $4.9 billion in August from the same month a year ago. Cardholders across all industries made 139 million transactions in August versus 137 million in July. The average value was $48.
(BusinessDesk)
Sophie Boot
Mon, 11 Sep 2017
Mon, 11 Sep 2017
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Retail spending declines as hospitality, durable goods sales dip
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