Australia: Weak Christmas shopping prompts the sharpest contraction in retail sales in a year
Nominal retail sales in December contracted 0.4% over the previous month in seasonally-adjusted terms, following November’s revised 0.5% expansion (previously reported: +0.4% month-on-month). This was well below market expectations of a softer 0.1% drop. As November’s retail sales were boosted by Black Friday and Cyber Monday sales, sales in December came in particularly weak. Moreover, subdued wage growth, dropping house prices and a hefty stock of household debt continue to weigh on consumers’ spending.
Shrinking sales in household goods, as well as in clothing and footwear led the contraction, partially offset by higher sales in food retailing and cafes, restaurants and takeaway food services.
In annual terms, retail sales expanded 2.2% in December, down from November’s 3.3% increase. Meanwhile, annual average growth in retail sales in December inched up to 3.0% from November’s 2.9%.