Wellington, Aug 10 NZPA - The value of transactions using electronic cards in retail industries fell a seasonably adjusted 0.1 percent in July from June, mainly due to a 3.1 percent fall in fuel sales.

Figures from Statistics New Zealand (SNZ) today show that when vehicle-related industries were excluded, the value of core retail transactions using electronic cards rose a seasonally adjusted 0.7 percent last month.

While most core retail industries had rises in July, consumables -- including food, liquor, and chemist sales -- were the main contributor to the rise in the core retail category, with a lift of 2.1 percent, SNZ said.

When a 1 percent fall in non-retail industries -- including services such as travel and health, and wholesaling -- was included, the total value of transactions fell 0.2 percent in July.

Goldman Sachs & Partners New Zealand economist Philip Borkin raised the possibility that the rise in spending on consumables reflected higher food prices beginning to emerge.

The fall in spending on fuel was a slight surprise, given that the introduction of the emissions trading scheme in July saw petrol prices rise over the month, he said.

Industry contacts suggested retailers were still having to discount aggressively to get foot traffic and drive turnover, which partly explained lacklustre nominal spending growth.

The outlook for consumer spending relied heavily on the labour market where there were some encouraging signs, Mr Borkin said.

Further slow grind improvement in the labour market should be supportive of a recovery in consumer spending, but the recovery was set to be gradual by historical standards.

The actual value of transactions in the core retail series last month was 4.5 percent higher than in July 2009.

Trends for the value of transactions in the total and retail series had both been flat since early 2010, SNZ said.

Although the core retail trend has generally been flat since November 2007, it has been rising steadily since March 2010 and was up 2.7 percent since then.