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NZ retail sales’ rapid pace

work-money-dollar business, finance, journey, pathNew Zealand second-quarter retail sales volumes rose at the fastest pace in close to a decade, beating economist expectations.

The volume of retail sales increased a seasonally adjusted 2.3 percent in the three months through June from the March quarter, the biggest percentage increase since the December 2006 quarter, Statistics New Zealand said. That’s ahead of the 0.9 percent forecast in a Reuters poll of economists. Retail sales volumes for the March quarter were revised up to 1 percent from 0.8 percent. Core retail volumes, which excludes the more volatile vehicle-related industries, increased 2.6 percent in the June quarter, the agency said.

Volumes of hardware, building and garden supplies rose 5 percent, motor-vehicle and parts retailing gained 2.6 percent, pharmaceutical and other store-based retailing increased 5.2 percent and food and beverage services advanced 3.3 percent, the agency said. The biggest declines were in fuel retailing, which slipped 1 percent, and recreational goods, which dropped 3.3 percent.

On an annual basis, the quarterly value of actual retail sales rose 5.5 percent to $19.9 billion, while the volume rose 6 percent, the data showed.

Retailers’ inventories were 4.6 percent higher at $7.2 billion at June 30 compared with the year earlier, with core retail stocks up 5.1 percent, the agency said.

Retail NZ, the trade association representing over two thirds of total retail spend in New Zealand, has welcomed news that consumer spending in New Zealand has increased over the June 2015 quarter, after the release of the latest Retail Trade Statistics.

“Retailers are reporting to us that they are feeling optimistic about their sales targets, and consumers are spending well,” Retail NZ’s GM for public affairs Greg Harford said. “The latest Retail Trade statistics confirm this, and are consistent with the general sentiment that we are hearing from retailers.

“The first three months of the year saw a slight increase in consumer spending, and this translated into a solid increase in the June quarter. Kiwis love to get out and shop, especially when the weather is good, and it seems that the delayed start to winter was positive for many retailers, offering a longer time to sell through stock which relies on warmer weather. In the quarter ended June, we saw a solid lift in sales in the hardware, building and garden supplies category, reflecting continued low interest rates and our nation’s ongoing love of housing.

“Generally, retailers saw the June quarter as encouraging and are feeling positive about business for the upcoming three months. 85 per cent of retailers are telling us that they expect to meet or exceed their sales targets in the next quarter, and we expect that this week’s movement in interest rates will help support further consumer spending.”

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