NZ retail spending shrinks in December
New Zealanders continued to wind back their spending in the lead-up to Christmas after a short-lived splurge during the Rugby World Cup.
The value of total electronic transactions fell 0.2 percent to a seasonally adjusted $6.6 billion in December, according to Statistics New Zealand. That follows a 0.3 percent decline in November and a 1.7 percent decrease in October 2011, as households continue to keep a lid on their spending. Spending in core retail industries, which strips out vehicle related spending, fell 0.1 percent.
“The December result suggests the boost to spending from the Rugby World Cup was short-lived, which was to be expected,” ASB economist Christina Leung said in a note. “We expect a continued recovery in underlying retail spending over 2012, although this will likely remain gradual in light of the continued high level of household debt.”
That comes after the New Zealand Institute of Economic Research’s quarterly survey of business confidence showed retailers’ high expectations for the Rugby World Cup didn’t appear to materialise in the December quarter, with sluggish sales leading to an inventory build-up. Still, retail sales growth remained positive at 2 percent, slowing from 4 percent in the September quarter.
Today’s figures showed electronic card spending on fuel fell 0.1 percent in December after strong rises in each of the four proceeding months. Spending across all retail industries was down 0.3 percent when motor vehicle-related industries are included.
Spending on consumable and durable items bucked the downward trend, rising 0.5 percent to $.146 billion and 0.4 percent to $996 million respectively.
“Encouragingly, spending on durables continue to improve, despite recent consumer confidence surveys suggesting consumers are less enthusiastic about making major household purchases,” Leung said.
The data showed there a record 101 million transactions in retail industries during the month, the first time the series has reported more than 100 million transactions. The actual number of transactions was up 6.5 percent from December 2010.
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