Australia Retail June 2019

Australia

Australia: Consumers close Q2 on a more positive note

August 2, 2019

Nominal retail sales in June rose a healthy 0.4% over the previous month in seasonally-adjusted terms, accelerating from May’s subdued 0.1% uptick. This beat market expectations of a 0.3% increase. June’s reading suggests consumer spending if starting to benefit from the recent decline in mortgage rates, as well as from the bottoming out of the country’s house prices. That said, household spending remains on the watch list of Australia’s policymakers, due to protracted modest wage growth and high levels of debt.

June’s increase came on the back of higher sales in clothing, footwear and personal accessory retailing; other retailing; cafes, restaurants and takeaway services; food retailing; and household goods retailing. Meanwhile, sales in department stores decreased.

In annual terms, retail sales expanded 1.9% in June, notably down from May’s 2.9% increase. Meanwhile, annual average growth in retail sales was stable at May’s 3.0%.

With June’s data, retail sales expanded a mere 0.2% in inflation-adjusted terms over the previous quarter, suggesting the contribution to growth of private consumption was quite modest in the second quarter.

FocusEconomics Consensus Forecast panelists see private consumption growing 2.5% in 2019, which is unchanged from last month’s forecast. For 2020, the panel expects private consumption to expand 2.7%.


Author: Massimo Bassetti, Economist

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Australia Retail May 2019 0

Note: Month-on-month seasonally adjusted changes and annual average variation of retail sales index in %.
Source: Australia Bureau of Statistics and FocusEconomics calculations.


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