Australia: Retail sales increase tepidly in January
Nominal retail sales in January rose 0.1% from the previous month in seasonally-adjusted terms, contrasting December’s 0.5% drop and undershooting analysts’ expectations of a 0.4% increase. January’s result came on the back of higher sales in the other retailing, household goods, and cafés, restaurants and takeaways sectors, which were partially offset by lower sales of clothing, footwear and personal accessories.
January’s figures were disappointing, particularly coming after a weak December reading, as consumers continued to keep a rein on the purse strings after a spending splurge in November associated with Black Friday and the launch of the iPhone X. Although the weak performance of the retail sector could appear counterintuitive given the robust labor market and positive consumer sentiment, it can be explained by meager wage growth, which was barely higher than inflation in Q4. On a year-on-year basis, retail sales expanded 2.3% in January, up from 1.6% in December, while annual average retail sales growth remained at 2.4%.