Australian retail sales continued to advance in April following a strong first quarter, showing resilience to rising prices and weakening sentiment. Supermarket and liquor sales for Easter boosted turnover in April, while discretionary spending remains elevated and was supported by increased travel and social gatherings over the holiday period.
Retail Sales — April | By the numbers
- National retail sales advanced by 0.9% in April, matching the preliminary estimate, to $33.9bn. Sales in March lifted by 1.6%.
- 12-month retail sales firmed to 9.6% from 9.4% in March.
Retail Sales — April | The details
Retail sales were up for the fourth month running, though April's 0.9% rise was down from the increases seen over January-March of between 1.6% to 1.8%. Although partly reflecting rising prices, demand has been solid, with inflation-adjusted sales rising by 1.2% over the first quarter and there were further signs of this momentum extending into April.
There was a further lift in discretionary sales (0.3%m/m) on the back of the strong rise seen in the previous month (2.4%), with the category now up 28% on its pre-Covid level. Although spending on household goods (-2.7%) and at department stores (-2.5%) pulled back, spending associated with social gatherings and travel over the Easter holiday period boosted turnover at cafes and restaurants (3.3%) and for clothing and footwear (3.1%).
The holiday period also lifted food sales (1.9%m/m), which drove the headline increase in turnover. Higher prices (and reduced discounting) due to supply shortages and increased transportation costs would have contributed to this rise. The major drivers were supermarket sales lifting by 1.4% in the month (6.6%yr) and a 6.5% surge in liquor sales (9.5%yr).
The 0.9% rise in national turnover was weighed by a 0.3% fall in New South Wales, with that state accounting for just under one-third of national sales. The fall in NSW was driven by declines in household goods (-3.6%), clothing and footwear (-1.4%) and department stores (-8.1%), though all these categories are still well above pre-Covid levels.
Sales growth exceeded the national increase in Victoria (1.1%), Queensland (1.6%), South Australia (1.4%), Western Australia (2.2%) and Tasmania (2%).
Retail Sales — April | Insights
Another solid month for retail sales reflecting the resilience of Australian household demand reported in the Q1 National Accounts (see here). Discretionary spending is elevated, though in April it was the food category that drove the headline rise in turnover as households stocked up with food and liquor for Easter holiday gatherings.
