NZ plastic card spending jumps in January
Retail spending rose a seasonally adjusted 2.7% in January after two months of zero movement, the biggest monthly gain since December 2006.
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New Zealanders spent more on plastic cards in January after a more subdued end to 2016 and continued to lean more heavily on their credit cards.
Retail spending rose a seasonally adjusted 2.7% in January after two months of zero movement, the biggest monthly gain since December 2006, with increases across all six industries, Statistics NZ said. Stripping out vehicle-related spending, core retail sales rose 2.5% in the month led by a 3.1% increase in durable items.
"The lift in retail card spending in January was across the board, from food and liquor to clothing, petrol, and cars, as well as a bounce back for furniture, hardware, and appliances," business indicators senior manager Neil Kelly said in a statement.
On an unadjusted basis, retail spending was 5.6% higher than a year earlier at $5.13 billion in January, with spending on fuel up 10% to $628 million as global oil prices rose from their lows and a 9% increase in hospitality spending to $1.02 billion. Total card spending, which includes services and non-retail sectors, was up 5.3% to $6.73 billion.
The proportion of spending on credit cards was 49.6% in January, the first time it's been above 49% since Statistics NZ started measuring the ratio in October 2002, and marking the seventh month of a growing proportion of spending on credit.
Westpac Banking Corp economist Satish Ranchhod said the increase was "well above market estimates" with a "very positive" outlook for retail spending in the year ahead.
"Population growth remains strong, employment is up, and we continue to see strong tourist inflows," he said in a note. "With interest rates still relatively low, and a range of other supportive factors in play, we expect that spending will remain firm for some time yet."
(BusinessDesk)
Paul McBeth
Mon, 13 Feb 2017
Mon, 13 Feb 2017
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
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NZ plastic card spending jumps in January
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