NZ retail sales’ slow growth

woman shopping 2The total volume of New Zealand first quarter retail sales, increased a seasonally adjusted 0.8 per cent for the March 2016 quarter compared to the 1.1 per cent rise in the previous quarter, Statistics New Zealand data shows.

The strongest growth seen for the quarter was in electronic and electrical goods retailing, up 3.8 per cent, and online and commission-based retailing, up 10 per cent, while the slump in oil prices boosted fuel sales. The warm weather encouraged spending in restaurants, takeaways and bars. Food and beverage services saw a 1.3 per cent increase, and clothing, footwear and accessories, up 1.7 per cent. That was offset by a 3.8 percent decline in specialised food retailing and a 0.6 percent fall in liquor sales.

“The moderation in retail sales growth in early 2016 isn’t too surprising,” said Satish Ranchhod, Westpac senior economist. “Late 2015 saw strong growth in spending on durable items such as hardware and furnishings, and it’s normal to subsequently see a bit of a softening.”

Ranchhod said the report highlighted that inflation in the economy remains subdued.

“We estimate that retail prices were down 0.2 per cent over the quarter, and were up down 0.4 per cent over the year,” he said.

After adjusting for price changes, spending was up across 12 of the 15 retail categories in March. Growth in spending was heavily centred in Auckland, with most other regions experiencing only limited gains or in some cases declines in spending.

There was a large fall, however, in fuel retailing, down 4.9 per cent ($94 million), which was price driven.

In actual terms, the value of total retail sales was $20.2 billion in the March 2016 quarter, up 4.7 per cent ($903 million) from the March 2015 quarter.

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