Plastic pushes July spending up on last year
Consumers’ plastic cards saw more of the light of day last month.
Electronic card transactions in the core retail sector rose 0.5 per cent by value from June levels, seasonally adjusted, to be 5.3 per cent up on July last year.
When sales in the automotive sector are included total retail card transactions were flat month-on-month and up 4.3 per cent on July 2013. The pickup in core retail sales reverses a 0.3 per cent decline in June.
“That suggests spending remains on an uptrend, consistent with recent signs of revival in the housing market, albeit not at the pace seen in late 2013,” said ASB economist Nathan Penny. Most of the components of core retail spending more than made up for a weak June.
“Consumables were up 0.3 per cent, durables up 0.9 per cent, and clothing rose a whopping 1.7 per cent — perhaps a delayed lift as the winter chill set in. Only hospitality was down, by 0.6 per cent, breaking a 10-month run of increases.”
Westpac economist Felix Delbruck said the 0.3 per cent rise in consumables spending looked to be on the soft side in light of recent strong population growth from migration. The Westpac McDermott Miller survey has found consumer confidence running at levels last seen in 2005.
But the level of confidence had not translated into the same levels of spending, Delbruck said.
“. . . we expect the modest acceleration in household spending to continue.”