Fiscal update a sea of red

Retail trade data shows economy recovering from coronavirus

AUSTRALIANS should prepare to see “eye-watering numbers” on debt and deficit when Treasurer Josh Frydenberg reveals the worst budget black hole since World War II.

Mr Frydenberg will on Thursday provide an economic update, including unemployment rate forecasts.

“You will see eye-watering numbers around debt and deficit,” Mr Frydenberg told Today. “Numbers that Australians have never, ever seen before. The coronavirus has required the government to spend unprecedented amounts of money to support people.”

AUSTRALIA’S economy is showing signs of improvement since the initial pandemic shutdown, with retail trading figures across the country surging.

Figures from the Australian Bureau of Statistics show retail turnover for the month of June rose 2.4 per cent compared with May, fuelled by easing COVID-19 restrictions that have allowed more businesses to open doors.

June’s monthly rise comes after May’s strong surge of 16.9 per cent, rebounding from the April retail collapse that was induced by COVID-19 lockdown measures.

The ABS said the monthly rises were spurred on by greater turnover in the hospitality industry, particularly in cafe, restaurant and takeaway services.

Easing conditions had also enabled greater trade to occur in clothing, footwear and personal accessory retailing, the ABS said.

“While some restrictions on trade remained in June, many businesses in these industries saw a full month of trade, having been closed for the first week of May 2020,” the ABS said.

Despite improvements since the initial economic shock, turnover within hospitality and retail industries remains lower than levels experienced in June 2019.

However, total retail turnover rose 8.2 per cent when compared to June 2019 in seasonally adjusted terms.

Food retailing rose 0.9 per cent, which was driven by supermarkets and grocery stores offsetting falls in liquor retailing.

The ABS said there was evidence stockpiling grocery goods had returned at the end of June, particularly in Victoria where lockdown measures were reintroduced.

“At the end of the June month there was some evidence of stockpiling of goods such as toilet paper, flour, rice and pasta,” the ABS said. “At the aggregate level, stockpiling is most evident in Victoria.”

Department store trading fell 12 per cent and household goods retailing also fell compared with May but remained 23 per cent above levels experienced in June 2019.