Retail Sales — April | By the numbers
- Retail turnover fell by 0.1% in April to $A27.328bn; a clear miss on the expected outcome for a 0.2% rise. Turnover growth in March was unrevised at 0.3%.
- Annual turnover growth slowed to 2.8% from 3.5% in the previous month.
Retail Sales — April| The details
The detail across the categories showed broad-based weakness in April. Turnover in food lifted by 0.2% and by 4.2% over the year. If that category is removed, turnover growth fell by -0.2% in the month to be just 1.9% higher for the year. Surprisingly, spending in department stores increased by 1.8% in April (+2.7%Y/Y), while 'other' retail (sporting goods, pharmaceuticals and newspapers etc) lifted by 0.8% (+3.9%Y/Y). However, the other discretionary areas declined; household goods -0.9% (-1.6%Y/Y), clothing and footwear -1.2% (+4.0%Y/Y) and cafes and takeaway food -0.7% (+2.7%Y/Y).
Looking across the states, turnover declined by 0.4% in both New South Wales and Victoria in April. Combined, those two states account for nearly 60% of national retail spending. Through the year growth has slowed to just 1.2% in New South Wales, but is stronger in Victoria at 3.7%. For the other states, Queensland lifted by 0.7% (+6.0%Y/Y), South Australia by 0.6% (+3.1%Y/Y), Western Australia by 0.1% (+0.5%Y/Y) and by 0.3% in Tasmania (+2.6%Y/Y).
Retail Sales — April| Insights
This was a weak update to start Q2 for the household sector, though it is possibly overstated by public holidays for Easter and ANZAC Day. Still, consumer spending is sluggish, and particularly so in New South Wales that is likely a response to the cooling housing market. With the Reserve Bank of Australia widely expected to cut the cash rate by 0.25% today and the federal government intending to implement increased tax relief, that should offer some support for retail spending towards the second half of 2019.
