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

 

Deutsche Bank - NZ: Retail Sales - August 1999

Deutsche Bank - NZ: Retail Sales - August 1999

Deutsche Bank
Economic Note (New Zealand)
NZ: Retail Sales - August 1999

Key Points

Retail sales (nominal, s.a.) rose by 1.3% mom during August, following a fall of 0.2% July. That volatility is largely related to uneven trading day patterns. The monthly trend measure rose by 0.4%.

Retail sales were 6.1% higher than in August 1998, with the deflator estimated to account for only 1.0% of that. Motor vehicle retailing and services contributed around half of the 1.3% monthly increase (with recent petrol price increases accounting for a only a relatively small proportion). However, when removing the volatility that is present even in the seasonal adjusted data, both the automotive sector and the rest of the retail sector recorded trend growth of 0.4% in August.

The August data was significantly above average market expectations of a zero increase.

Retail::::::::::Seasonally::::::::::::::::::::::::: Trend
Sales:::::::::: Adjusted::::::::::::::::::::::::::::::Sales
::::::::::::::: ($m)::::: mom. %::::: Ann. %::::: mom. %

Feb-99:::::::::: 3,321.1::::: 0.5::::: 2.5::::: 0.3

Mar-99:::::::::: 3,383.8::::: 1.9::::: 5.0::::: 0.2

Apr-99:::::::::: 3,355.6:::::-0.8::::: 3.7::::: 0.3

May-99:::::::::: 3,300.4:::::-1.6::::: 4.2::::: 0.4

Jun-99:::::::::: 3,398.5::::: 3.0::::: 5.1::::: 0.5

Jul-99:::::::::: 3,390.2:::::-0.2::::: 3.9::::: 0.5

Aug-99:::::::::: 3,432.9::::: 1.3::::: 6.3::::: 0.4

Source: DB Global Markets Research, SNZ

Comment The sectoral breakdown of the underlying sales trend suggests that recent household spending patterns have been broadly based. That is a change from the June quarter when motor vehicle sales and servicing outgrew the rest of the retail sector. Recent spending patterns are entirely consistent with consumer confidence, which has adjusted from inflated levels earlier this year.

Looking ahead, a flat September month, or even a small downward correction, would still generate nominal sales growth of 1.5-2.0%, suggesting a volume increase of 1.0-1.5%. That, in turn, would imply a significant rebound in consumption growth from the June quarter. Today's outturn is consistent with our view that the -0.3% result for June quarter GDP was not a fair reflection of the underlying state of the economy, which suggests significant bounce- back potential for the September quarter.

Further data over the coming month are expected to confirm that point, with the Quarterly Survey of Business Opinion (19 October) and the September quarter Household Labour Force Survey (4 November) being the key releases. As a result, the case for a November RBNZ tightening will remain strong - particularly considering increasing evidence that not only the September quarter, but also the December and March quarters, will show high CPI increases as a result of the flow through of rising oil prices and the weak NZD. From a policy point of view, rising interest rates and a weak NZD would reflect real economy trends: continued buoyancy in the consumption and residential construction sectors, while the external sector has, so far, shown only weak signs of recovery.

ENDS

This, along with an extensive range of other publications, is available on our web site http://research.gm.db.com

In order to read our research you will require the Adobe Acrobat Reader which can be obtained from their website http://www.adobe.com for free.

For answers to your EMU questions, check Deutsche Bank's EMU web site http://www.db.com/emu or email our helpline business.emu@db.com.


© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Manawatu-Whanganui Projects: PGF Top-Up To Rural Broadband Roll-Out

The government has effectively raided the $3 billion Provincial Growth Fund to top up the budget for the second phase of its rural broadband initiative, filling in mobile 'black spots' and ensuring broadband is available to marae that don't have access now. More>>

ALSO:

Other Windy Cities: Auckland-Chicago Named A Top 10 ‘Most Exciting’ New Route

The inclusion of Auckland-Chicago on Lonely Planet’s Where to fly in 2019? The 10 most exciting new flight routes list comes just two weeks before Air New Zealand prepares to celebrate its inaugural flight to Chicago’s O’Hare International Airport on 30 November. More>>

Deadly Strain: ESR Ups Its Reporting On Meningococcal Disease

The increasing number of cases of Group W Meningococcal disease (MenW) has prompted ESR to increase its reporting on the disease to the Ministry of Health. ESR has upped its reporting to weekly. More>>

ALSO:

Very Small Things: "Game-Changing" 3D Printing Technology Launched

New Zealand microfabrication researchers Andrea Bubendorfer and Andrew Best, the co-inventors of a new way of fabricating very small things with Laminated Resin Printing (LRP), are part of Callaghan Innovation’s MicroMaker3D team launching the new patent pending technology in the US this week. More>>

ALSO: