Tourism spurs big July increase in plastic card spending

Tuesday 9th August 2016

Spending on electronic cards rose strongly last month, led by the biggest monthly gain in hospitality expenditure since November as the sector continues to enjoy the benefits of an expanding population and booming tourism numbers.

Retail spending rose a seasonally adjusted 0.3 percent in July, slowing from the 1.2 percent increase in June, Statistics New Zealand said. However, spending on hospitality was up 2.9 percent in July, the largest area of increase. Spending on fuel dropped 3.6 percent as cheap oil continues to reduce costs for motorists. Core retail spending, which excludes vehicle-related items, was up 0.7 percent in the month.

"People spent more on accommodation and on food and drinks in restaurants and takeaway shops," business indicators senior manager Neil Kelly said in a statement. "In contrast, they spent less on fuel, with petrol prices falling about 10 cents a litre in July."

The hospitality sector has been reaping the benefits of New Zealand's prolonged tourism boom at the same time as record net migration numbers have boosted the population.

Today's data show electronic card spending on hospitality in July was 18 percent higher than a year earlier at $925 million. Core retail spending was up 8.3 percent at $4.11 billion in July from a year earlier, with expenditure on consumable goods gaining 5.5 percent to $1.74 billion, durables items up 6.5 percent to $1.15 billion, and apparel spending up 5.1 percent to $291 million.

By contrast, credit and debit card spending on fuel dropped 8.6 percent to $571 million. Spending on vehicles rose 4.7 percent to $161 million from a year earlier, and total retail spending increased 5.8 percent to $4.84 billion.

Including services and non-retail industries, spending on electronic cards increased 4.5 percent to $6.53 billion in July from the same month a year earlier.

The number of transactions across all industries rose 7.7 percent to 134 million, while core retail sales transactions were up 8.2 percent to 99 million from July 2015. The average value per transaction was $49.

(BusinessDesk)

BusinessDesk.co.nz

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