Spending on fuel and apparel fell significantly from April to May, according to data from Stats New Zealand.
An analysis of electronic card transactions covering both credit and debit cards in shops and online, showed spending on apparel fell by $13 million or 3.7 per cent month on month, while purchases of fuel fell by $25 million, or 4.5 per cent.
Total retail card spending fell by $113 million (1.7 per cent) month on month in May, however year-on-year retail card spending of $6.4 billion for the month was up 3.3 per cent – by $203 million – compared with May last year.
The only industry to post a month-on-month rise in turnover paid via cards was the services sector, up by $1.4 million, or by 0.4 per cent.
“,” Stats NZ business performance manager Ricky Ho said.
The decline took at least one experienced economist by surprise. Westpac senior economist Satish Ranchhod said the figures showed the growing pressure on households’ finances.
“The softness in spending is particularly surprising given the lift in population growth in recent months as migration inflows have surged,” he told Stuff.
“Retail prices are continuing to rise at a rapid pace. We’re also seeing increasing numbers of households rolling on to higher mortgage rates.
“We expect those factors will be an increasing drag on household spending over the months ahead. Today’s result reinforces our expectations for a downturn in domestic economic conditions over the coming months,” he concluded.
