NZ spending on debit, credit cards increases in September
By Suze Metherell
Oct. 9 (BusinessDesk) - New Zealand retail spending on electronic cards rose for a fifth month in September, led by an increase in expenditure on durable goods and following recent improvements in retailers' business confidence.
Spending on core retail, which strips out fuel and vehicle purchases, rose a seasonally adjusted 1.2 percent to $4.03 billion in September, accelerating from August's 1 percent gain, Statistics New Zealand said. On an annual basis, core retail spending rose 7.7 percent from September last year, the biggest annual jump since January's 8 percent increase.
The increase in retail spending reflects more optimism among retailers in New Zealand Institute of Economic Research’s quarterly survey of business opinion earlier this week. While overall business confidence slumped to a more than four-year low, retailers remained upbeat in the three months ended Sept. 30. A net 7 percent of retailers surveyed expected improved sales, compared to a pessimistic outlook in the prior quarter, while a net 10 percent expected sales to improve over the next six months, up from a net 2 percent.
"While high levels of migration and strong tourist demand continue to provide support for retail activity, over the coming months we do expect to see some softening in spending growth," Westpac Banking Corp senior economist Satish Ranchhod said in a note. "Consumer confidence has fallen sharply, and a likely softening in economic growth will weigh on employment and earnings growth over the coming year."
Durable goods, such as furniture, hardware and appliance retailing, led the monthly gain, with spending on debit and credit cards climbing 1.9 percent to $1.2 billion. Hospitality sales increased 1.5 percent to $817 million while consumables, the largest contributor to the measure, rose 0.5 percent to $1.7 billion. Apparel sales declined 0.2 percent to $299 million.
Total retail sales, which includes fuel and vehicle sales, rose a seasonally adjusted 0.9 percent in September to $4.8 billion, with an annual gain of 6.1 percent to $4.5 billion. Total sales, which includes services and non-retail industries rose 0.7 percent in the month to $6.4 billion, for an annual increase of 6.4 percent to $6 billion.
There were 122 million transactions on electronic cards in September, up 7 percent from a year earlier. The average value of transactions was $49, with 55.2 percent put on to debit cards, and the remainder going on to credit. Electronic cards make up 67.8 percent of core retail sales, and 61.7 percent of total sales processed in New Zealand.