NZ credit, debit card spending falls on fuel purchases

Thursday 22nd January 2009

New Zealand consumer spending on credit and debit cards fell in December, after a record drop in the previous month, reflecting a decline in the value of fuel purchases.

Card spending dropped 0.5% from November, according to Statistics New Zealand. The card figures are an early indicator of retail sales in the latest month after spending was unexpectedly little changed in November.

Excluding auto-related purchases, sales gained 0.2% in December from November, the report showed.

New Zealand's economy fell into recession in the first nine months of the year and some economists predict it won't emerge from its slump until later in 2009. Helping underpin consumer spending, the central bank is expected next week to extend the steepest easing cycle since the official cash rate was introduced in 1999, cutting the OCR by 100 basis points to 4%.

There were 99 million electronic card transactions in December, valued at $5.6 billion. In the year-earlier month there were 95 million transactions valued at $5.6 billion. Petrol prices has declined with the slide in the price of crude oil.

In November, the value of electronic transactions fell by a record 2.8% from the previous month to $4.67 billion, according to Statistics New Zealand. Excluding fuel and auto-related spending, the value of transactions declined 0.5%.

The NZSE Consumer Index, which tracks prices of retailers and other consumer-related companies, fell 0.02% today, led by a 9.1% decline in Postie Plus Group. The index is down 38% in the past year.

By Jonathan Underhill

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