Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

NZ consumers pull back on spending in May

By Rebecca Howard

June 12 (BusinessDesk) - Consumers pulled back on credit and debit car spending in May after holidays in April fuelled a rise.

Seasonally-adjusted electronic card spending fell 0.5 percent in May after rising 0.6 percent in April. Core retail spending, excluding fuel and vehicle spending, also fell 0.5 percent following a 0.4 percent lift in April when people took advantage of the extended holiday period, which included Easter and school holidays, to travel domestically and eat out more.

ASB Bank senior economist Mark Smith said the data was "considerably weaker than market expectations." Economists polled by Bloomberg had expected a 0.5 percent rise.

"Card spending has slowed over the last three months," said Stats NZ retail statistics manager Sue Chapman. "Since February 2019 we have seen relatively softer growth in the retail industries indicating an easing in domestic spending."

Softer growth in household spending was one of the factors the Reserve Bank's monetary policy committee mentioned when it cut the official cash rate by 25 basis points to a record low 1.5 percent at the May review.

"The members agreed that given the recent weaker domestic spending, and projected ongoing growth and employment headwinds, there was a need for further monetary stimulus to meet its objectives," according to a summary record of the meeting included in the monetary policy statement.

ASB's Smith said, however, he still expects a "moderate rate of consumer spending growth going forward." He said government support for low-income families, low interest rates, record-high levels of residential construction activity, strong tourism inflows and low unemployment are supportive of retail spending.

However, "soft wage growth, cooling employment growth, high fuel prices and a weak Auckland housing market backdrop will likely limit the overall pace of NZ retail spending growth going forward."

Spending on consumables fell 0.4 percent, or $9 million, in May to $2.04 billion while spending on hospitality was unchanged at $1.08 billion.

May spending on durables - which include electronics, whiteware, hardware, and furniture - fell 0.8 percent or $10 million to $1.3 billion. Spending on apparel was down $4.7 million, or 1.5 percent, to $302 million while fuel spending dipped 0.4 percent, or $2.6 million, to $604 million.

In actual terms, cardholders made 151 million transactions across all industries in May, up from 144 million in April. The average value was $49, unchanged from the prior month.

Total actual retail spending using electronic cards was $5.39 billion, versus $5.33 billion in April, and was 3.2 percent higher than in May 2018. Core retail spending was $4.6 billion versus $4.58 billion a month earlier. On the year it was up 4.6 percent.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Up 0.5% In June Quarter: Services Lead GDP Growth

“Service industries, which represent about two-thirds of the economy, were the main contributor to GDP growth in the quarter, rising 0.7 percent off the back of a subdued result in the March 2019 quarter.” More>>

ALSO:

Pickers: Letter To Immigration Minister From Early Harvesting Growers

A group of horticultural growers are frustrated by many months of inaction by the Minister who has failed to announce additional immigrant workers from overseas will be allowed into New Zealand to assist with harvesting early stage crops such as asparagus and strawberries. More>>

ALSO:

Non-Giant Fossil Disoveries: Scientists Discover One Of World’s Oldest Bird Species

At 62 million-years-old, the newly-discovered Protodontopteryx ruthae, is one of the oldest named bird species in the world. It lived in New Zealand soon after the dinosaurs died out. More>>

Rural Employers Keen, Migrants Iffy: Employment Visa Changes Announced

“We are committed to ensuring that businesses are able to get the workers they need to fill critical skills shortages, while encouraging employers and regions to work together on long term workforce planning including supporting New Zealanders with the training they need to fill the gaps,” says Iain Lees-Galloway. More>>

ALSO:

Marsden Pipeline Rupture: Report Calls For Supply Improvements, Backs Digger Blame

The report makes several recommendations on how the sector can better prevent, prepare for, respond to, and recover from an incident. In particular, we consider it essential that government and industry work together to put in place and regularly practise sector-wide response plans, to improve the response to any future incident… More>>

ALSO: