Australia retail sales disappoint in November, consumer spending likely accelerated in Q4
Australian retail sales came in weak in November. It rose just 0.2 percent on sequential basis, as compared with the rise of 0.5 percent in October. Consensus expectations were for retail sales to grow 0.4 percent sequentially. The average month rises of the previous three months was 0.6 percent. On a year-on-year basis, Australia’s retail sales grew 3.3 percent, whereas in trend terms, retail sales rose 0.4 percent sequentially for four straight months.
Looking at region wise results, retail sales came in pretty strong in Victoria and NSW, which recorded a rise of 0.4 percent and 0.5 percent month-on-month respectively. Both regions recorded year-ended growth of 3.5 percent and 4.3 percent respectively. In NSW, sales of hardware, building and garden supplies rose 4 percent sequentially, consistent with still strong house price growth. But this was countered by a fall in sales in WA and SA and a meagre 0.1 percent sequential growth in Queensland.
The weakness was focused in small store sales that dropped 0.3 percent sequentially, which tend to be more volatile, said ANZ in a research report. On the contrary, large store sales grew 0.4 percent month-on-month in November. Food sales were up 0.4 percent in sequential terms, whereas clothing sales rebounded 1.7 percent month-on-month. Household goods sales grew 0.2 percent sequentially. Sales at cafe and restaurant dropped 0.8 percent, whereas at department stores it fell 0.3 percent in sequential terms.
“We continue to expect consumer spending in Q4 to have accelerated from the previous quarters’ lacklustre pace, particularly given fairly upbeat anecdotes around the Christmas period”, added ANZ.
At 05:00 GMT the FxWirePro's Hourly Strength Index of Australian Dollar was slightly bullish at 56.9448, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at 2.53998. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex