NZ retail sales rise 1.2% in 4Q, less than expected, led by fuel, clothing

Felix Delbruck, senior economist at Westpac Banking Corp

New Zealand retail sales rose less than expected in the fourth quarter, with fuel, clothing and recreational goods leading the gains, while food, liquor, grocery and commission sales fell.

The volume of retail sales rose 1.2 percent, seasonally adjusted, in the final three months of 2013, according to Statistics New Zealand. Actual sales were up 3.9 percent from the same quarter a year earlier. Sales lagged behind the 1.6 percent quarterly gain and 4.5 percent annual increase forecast by economists in a Reuters survey.

Figures for the third quarter were revised down to a seasonally adjusted gain of 0.2 percent from the previously published 0.3 percent, suggesting retail sales growth in the second half of 2013 wasn't as robust as some had expected. The kiwi dollar fell to 83.59 US cents from 83.86 cents immediately before the figures were released, as some traders questioned how aggressively the central bank will raise interest rates starting next month.

Excluding fuel and vehicle-related spending, core retail sales rose 0.7 percent from the previous quarter.

Clothing, footwear and accessories sales gained 9.9 percent, recreational goods sales rose 8.6 percent and electronic goods sales gained 3.1 percent. Non-store and commission based retailing fell 10 percent and supermarket and grocery store sales declined 0.5 percent. Accommodation fell 2.4 percent.

"In themselves, today's numbers suggest some downside risk to our 1.4 percent December quarter GDP forecast, which assumed a strong lift in retail spending in the quarter," said Felix Delbruck, senior economist at Westpac Banking Corp. "There were surprising declines in spending on food, accommodation and non-store retailing - the latter two possibly indicating that a strong NZ dollar has been making the going tougher for domestic operators in those categories."

Fuel retailing, which isn't seasonally adjusted, rose 5.7 percent in the latest quarter. Vehicle spending rose 0.8 percent.

(BusinessDesk)

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