NZ retail card spending falls on lower grocery, liquor expenditure
New Zealand retail spending on electronic cards dipped in May as people dialled back expenditure on groceries and liquor.
Retail spending on credit and debit cards fell a seasonally adjusted 0.4 percent last month, following a 0.9 rise in April, Statistics New Zealand said. Three of six retail industries fell in May, led by a drop in the consumables industry - which includes grocery and liquor retailing - which was down 0.7 percent versus the prior month. Fuel retailing was down 1.8 percent while hospitality spending was down 0.8 percent.
Vehicle spending - excluding fuel - was unchanged on the month, while spending on durables inched up 0.1 percent and spending on apparel gained 0.9 percent.
The Reserve Bank is keeping a close watch on consumer spending after an unexpectedly strong consumption surge through the second half of last year, amid concerns people are more willing to fund retail purchases with debt.
"This month's decline in spending wasn't too surprising following last month's strong gain," said Westpac Banking Corp senior economist Satish Ranchhod. He noted, however, there are some signs that spending momentum is fading.
"After a strong lift in January, spending levels have been flat in a number of key categories, including durables and apparel. Some of this likely to be related to the slowdown in the housing market since late 2016, which will continue to weigh on spending through the latter part of the year," he said. Overall, however, spending is expected to remain firm in the near term, supported by population growth and a strong tourist season, he said.
Today's figures show core retail spending, which excludes vehicle-related industries, dropped 0.4 on month in May after rising 1.4 percent in April.
Of the non-retail industries, non-retail excluding services advanced 0.2 percent from April, while spending in the services industry rose 0.7 percent.
Actual retail spending climbed 5.2 percent to $5 billion in May from the same month a year earlier.
Card-holders across all industries made 139 million transactions in May, up from 134 million in April and 130 million in May last year, with an average value of $49.