Electronic card transactions at retailers climb 0.3%

Monday 11th May 2009

New Zealand spending on debt and credit cards at retailers rose for a third month in April, stoking optimism consumers may be feeling less gloomy about their prospects.

Transactions in retail industries rose 0.3% last month, the same-sized gain as in March, according to Statistics New Zealand. Transactions at core retail industries, which exclude motor vehicle-related outlets, rose 0.5% in the latest month, after a 0.7% in March.

“It is early days, but we are seeing signs of a recovering trend becoming entrenched in the retail data,” said Bernard Doyle, New Zealand strategist at Goldman Sachs JBWere. “This is consistent with other signs of recovery in leading indicators in house sales and business/consumer confidence.”

The card data comes after central bank figures showed credit card billings climbed 1.6% in March from the same month of 2008.the electronic card data is regarded as a timely indication of the track of retail sales figures, which lag by about a month and include cash and cheque payments, and hire purchase.

Helping stoke optimism, the central bank has indicated short-term borrowing rates aren’t likely to rise until the second half of 2010, though that’s offset by concern about the rising jobless rate.

The NZSE Consumer Index, which includes all retailers listed on the NZX, climbed 1.7% today, bringing its advance in the past month to 14%.

Clothing chain Postie Plus Group led the gains, soaring 27% to 38 cents after managing director Ron Boskell. Said third-quarters ales rose 7.3% and margins widened, bringing the company closer to a return to profitability.

The government figures showed the consumables industry, which includes food, liquor and chemist retailing, was the biggest contributor to the monthly gain, while clothing, soft-goods and footwear retailing declined. Retail trade data for the March quarter is scheduled for release on May 15.

Businesswire.co.nz

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