Kiwis spend more in October, in first month to capture GST effect

Monday 8th November 2010

New Zealanders increased spending last month, the first since tax changes took effect, with figures from Paymark indicating a pick-up in sales beyond the tax impact.

Spending rose 3.3% in October from the same month of 2009, based on sales through the Paymark network, which processes more than 75% of the nation’s electronic transactions at retailers. The volume of sales rose 4.9%.

“One month’s data is not enough to determine if the increase has come as a result of people having more money in their wallets, or simply because prices have gone up – it would appear to be a bit of both at this stage,” said Paymark chief executive Simon Tong.

Takeaways, supermarkets, bars and clubs and footwear reported the strongest growth. Spending on big ticket items fell, with home appliances declining 14% and furniture dropping 6%.

Spending growth was strongest in South Canterbury, at 8.1%, Palmerston North on 7% and Waikato on 5.7%, while spending in Marlborough declined 9.2% and those on the West Coast dropped 1.4%.

Last month’s figures showed the continuation of the trend to use existing funds rather than pile on credit card debt. Debit card spending rose 6.5% in October while credit card spending fell 0.3%.

Businesswire.co.nz

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