New Zealand: Retail sales slow in first quarter
May 14, 2013
In the first quarter, retail sales expanded a seasonally adjusted 0.5% over the preceding period, which came in below both the revised 1.9% increase observed in the final quarter of 2012 (previously reported: 2.1% quarter-on-quarter) and market expectations of a 0.8% increase.
According to the national statistical institute, the slowdown in Q1 mainly reflects a notable drop in sales of clothing and footwear due to a warmer-than-usual start to autumn. In contrast, sales of pharmaceutical products showed a strong increase.
Compared to the same quarter last year, retail sales accelerated from a 3.2% increase in the fourth quarter to a 3.5% expansion in the first. That said, annual average growth in retail sales remained stable at Q4's 1.2%.
Healthy growth in retail sales bodes well for private consumption going forward. FocusEconomics Consensus forecast participants expect private consumption to expand 2.4% this year, which is up 0.2 percentage points from last month's projection. For 2014, the panel sees private consumption increasing 2.3%.
Author: Ricardo Aceves, Senior Economist