Despite 1.2% Uptick, New Zealand 4Q 2013 Retail Sales Still Below Expectations
By Esther Tanquintic-Misa | February 18, 2014 1:49 PM EST
Retail sales in New Zealand grew 1.2 per cent in the fourth quarter of 2013, but was still behind what economists expected.
Economists had projected New Zealand's retail sales to hit 1.6 per cent in the last quarter of 2013.
Of the country's 15 different retail sectors, nine had higher sales volumes, including fuel retailing up at 5.7 per cent; clothing, footwear and accessories up by 9.9 per cent; and recreational goods up 8.6 per cent.
The country's Retailers Association said the latest figures was in line with their expectations, noting actual sales jumped 3.9 per cent to reach $19.9 billion compared from a year ago in 2012.
But Daniel Smith, ASB economist, was surprised that supermarket sales volumes dropped 0.5 per cent in the fourth quarter of 2013, thus inching up the December 2012 data by a measly 0.5 per cent. All these despite the 4.5 per cent spike in electronic card spending on consumables as well as a net inflow of 22,500 migrants over 2013.
"Our estimates suggest that overall the household sector is not going on a spending spree, with more equity being injected to housing stock than is being withdrawn from it," ANZ chief economist Cameron Bagrie said.
"Spending growth - up [nearly] 4 per cent on a year ago - is travelling below income growth. It's common sense that it does, but common sense doesn't always apply to spending trends," he said.
Despite elevated consumer sentiment and an improving employment backdrop, consumers have not gotten carried away, ANZ senior economist Mark Smith said.
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