Friday 13th January 2017
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New Zealand seasonally adjusted retail spending on electronic cards eased more than expected despite the Christmas holiday.
Retail spending fell a seasonally adjusted 0.1 percent last month, after a 0.1 percent fall in November and a 0.5 percent rise in October, Statistics New Zealand said.
“It seems New Zealanders had a frugal Christmas,” said Westpac Bank senior economist Satish Ranchhod in a note. “This was much weaker than market expectations for a bounce following a similar-sized fall in spending in November,” he added. While Ranchhod had expected to see a rebound following earthquake-related disruption in November, he noted a range of factors continue to support spending, including strong population growth, a strong tourist season and improved fortunes in the dairy sector.
He said one of the big drivers of spending growth in recent years has been low interest rates and the flow-on to the housing market. As that market cools he is tipping a more “gradual pace” of spending growth in 2017.
While seasonally adjusted retail spending eased, actual retail spending climbed 5.8 percent to $6.5 billion in December from the same month a year earlier, the agency said.
"This is the first month card spending in hospitality exceeded $1 billion," business indicators manager Tehseen Islam said. "The higher hospitality spending coincides with a period of rising international tourism and residents enjoying Christmas and New Year holiday breaks."
Core retail spending, which excludes vehicle-related industries, dropped 0.8 percent in December from November, with spending on durables down 1.5 percent. Hospitality rose 0.5 percent and apparel was up 1.3 percent.
Of the non-retail industries, non-retail excluding services was unchanged from November while spending in the services industry rose 1.1 percent.
Spending on fuel rose 4.4 percent, while vehicle spending slipped 0.1 percent.
In actual terms, card-holders made 153 million transactions in December with an average value of $54.
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