Retail sales flat in August

Thursday 14th October 2010

New Zealand retail spending was flat in August, as households cut back on hardware and appliances purchases while stocking up on cars and fuel.

Retail spending was unchanged in August, seasonally adjusted, after falling 0.4% in July, according to Statistics New Zealand. Economists in a Reuters survey expected a 0.4% gain. Core retail spending, which excludes spending on motor vehicle-related goods, fell 0.6% after declining 0.1% in the previous month. Economists had forecast a 0.3% gain.

Spending declined in three quarters of the 20 core retail industries, lead by hardware retailing, which fell 5.8%, and appliance retailing, which fell 2.2%. Offsetting those declines was an increase in fuel and car purchases in August. Motor vehicle spending rose 2.3%, followed by automotive fuel retailing, which rose 2.1%.

"While today's result points to little sign of households bringing forward purchases of major items ahead of the GST increase in October, more recent September electronic card transactions data shows a robust increase in durables spending.," said ASB economist Christina Leung.

"This suggests declines recorded in some of the components will largely reverse out in the following month."

According to data released by the government statistician this week, New Zealand spending on debit and credit cards returned to growth in September, as consumers stocked up on household goods, food and petrol ahead of the hike in GST to 15%.

Today's data showed seasonally adjusted sales in the South Island rose 0.2% in August while sales in the North Island fell 0.3%. Canterbury was the only region to record an increase in sales, up 1.2%. Sales in the Auckland region declined 0.2%, followed by Waikato which fell 0.6%.

In actual terms, total retail sales rose 2.3% in August 2010 from the same month of 2009. Core retail sales rose 0.1%.

The department said the trend in total retail sales has been increasing since February 2009, and rose 3.8% since then. Core retailing is up 0.9% since a turning point in February 2010.

Businesswire.co.nz

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