Electronic card transactions climb at retailers gain

Thursday 10th June 2010

New Zealand spending on debit and credit cards at retailers rose for a fourth straight month in May as consumers shaking off the cobwebs and get more optimistic about their prospects.

The value of transactions in retail industries rose a seasonally adjusted 0.4% last month, from a 0.3% gain in April, according to Statistics New Zealand, with core retail transactions, which excludes motor-vehicle related outlets, up 1% last month from a 0.5% gain a month earlier. Durables, apparel and consumables recorded the biggest increases, while fuel retailing dropped 5.3%, the department said.

The card data comes after the central bank Governor Alan Bollard hiked the official cash rate 25 basis points to 2.75% amid a more upbeat assessment of the local economy in the face of Europe’s sovereign debt crisis. Bollard said household spending was improving at a “sluggish pace” with people more focused on paying down outstanding debt.

Still, more people were paying with their own money, with credit card down to 44% of all transactions in May, the lowest proportion since the series began. Credit card billings rose 3.4% in April compared to the same month in 2009, according to Reserve Bank data.

Total electronic card transactions edged up 0.2% month-on-month, while actual value of transactions in core retail spending on cards rose 0.9% from a year earlier.

The NZSE Consumer Index, which includes all retailers listed on the NZX, was little changed at 1591.35 today, and has edged down 0.2% this year.

The retail trade survey for April is due for release on June 14. Spending on electronic cards accounts for about 61% of all retail spending, and excludes cash and cheque purchases and hire purchase arrangements.

Businesswire.co.nz

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