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NZers Enjoying Cheap Night At Home, Retail Figures Show

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, April 14 NZPA - New Zealanders are seen to be "collectively enjoying a cheap night at home", based on new retail sales figures.

Data from Statistics New Zealand (SNZ) today show seasonally adjusted total retail sales rose 0.2 percent, or $10 million, in February from January. The February performance followed a fall of 1.2 percent in January.

ASB economist Jane Turner said that in the face of recession, households were changing their spending patterns and looking for cheaper entertainment options.

"Supermarket spending remains strong, with spending growth outpacing the monthly increase in food prices," she said.

"The trend in liquor retailing has been flat while spending at restaurants and bars is down.

"Meanwhile, personal and household goods hiring, of which video hire is a key component, has been growing strongly, up 9.5 percent mom (month-on-month) in January followed up by a 9.3 percent increase in February, suggesting DVD stores have been reasonably busy over the past few months," Ms Turner said.

The data "revealed that the nation is collectively enjoying a cheap night at home, with a home cooked meal, bottle of wine and a DVD."

Overall, the figures confirmed the general trend in retailing had been flat, consistent with subdued levels of consumer confidence.

The data shows fuel sales up 6.7 percent or $34m in February, seasonally adjusted, the largest rise since November 2007.

Compared with January, pump prices for petrol were higher throughout February, while prices for diesel showed little change, SNZ said.

Vehicle sales were down 3.2 percent or $17m in February, following a 12 percent fall in January.

The trend in vehicle sales was at its lowest level since January 2001. The trend had been falling since August 2007, dropping 27.1 percent since then.

Sales in core retailing, which excludes the four vehicle-related industries, were down 0.1 percent or $5m in February, following a 0.2 percent rise in January.

The largest decreases in core retailing for February was in recreational goods which were down 4.9 percent or $10m, following increases of 2.7 percent and 6 percent in December and January. Accommodation fell 4.2 percent or $9m.

Supermarket and grocery stores had the biggest increase from January with a lift of 1 percent or $12m in February, following an increase of 1.7 percent in January.

The trend in total retail sales had been in decline or flat since December 2007, falling 3.4 percent since then, SNZ said.

Goldman Sachs JBWere analyst Shamubeel Eaqub said the data was dated, with more up-to-date electronic card transactions suggesting core spending improved in March.

Tax cuts from the start of April and lower mortgage rates should provide some near term support, but he said the outlook hinged crucially on job losses.

Until greater clarity could be gained on the labour market, he was wary of placing too much faith on a likely short-lived improvement in consumer sector indicators over coming months.

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