Wallets open: Banks find signs of life in the retail sector as consumers start to spend
Two of the major banks have found a pulse in the retail sector that could be a sign of a revival with some surprising increases occurring in the sector.
Retail is starting to recover from its recession (file photo)
Westpac looked through its 6 million weekly card transactions in September to find that there had been a lift in activity that was a bit more broadly based than increases spotted earlier in the year relating to the Matilda’s advance through the FIFA World Cup and petrol price increases.
Over at the ANZ, its data for August discovered a massive jump in spending in duty free shops and a broad lift in tourism.
It found tourism spending was up 10.7 per cent for the 12 months to the end of August, a good sign for Queensland’s economy which has a significant tourism sector. Spending in duty free stores was up 90 per cent year-on-year. Spending in travel agencies jumped 27 per cent for the year and 12 per cent at tourist attractions.
Accommodation spending was up 7 per cent for the year whereas sales of luggage, furs and leather fell by 17 per cent, a result ANZ said was probably due to slow recovery in Chinese tourism.
Westpac senior economist westpac Matthew Hassan said the recovery in retail was looking a little more convincing.
NSW was showing a stronger recovery whereas Victoria was going backwards and Queensland was in a far more “moderate cycle”.
“We are still not off to the races by any means, but we are seeing signs of an improvement showing,” he said.
“In the past 12 months we had seen some pretty significant declines in household discretionary goods spending. That contraction looks to have eased off.
“Household goods tend to be those big ticket items which people cut back or postpone purchases if they are worried about the family finances.
“It may be a sign households are starting to come out of the shells.
“(Retail) growth is tracking to 1.5 to 2 but once you strip out inflation it’s maybe 1 per cent, once you strip out population it’s maybe 0.5 for the quarter.
“It’s a more positive tone, but it’s not off to the races. It does signal that we have to watch this space pretty closely.”
ANZ’s August data showed most categories of spending experienced a small uptick following some softer months. Despite this, total spending slipped slightly after seasonal adjustment.
