Retail Sales ‘Treading Water’
The result was in line with expectations although slightly higher than the 0.3% forecast by Westpac economists.
After a 0.6% gain in June, the July increase marks a decent back to back result although its coming off a 0.3% fall in May and a flat run between Feb and April, according to Westpac Senior Economist Matthew Hassan.
Trend sales growth is still flat, running at 0.1% month and an annualised pace of 1.3%.
There were solid gains in food-related sectors but softness elsewhere.
Household goods retailing rose marginally (0.2%) in trend terms but department stores (-0.2%) and ‘Other retailing’ (-0.1%) also fell. Electrical & electronic goods sales witnessed just a marginal rise compared to same time 2013.
Westpac analysis shows large retailers and chain stores outperforming in recent months with small retailers recording a much better sales burst through late 2013/early 2014.
“Overall the July retail report shows sales mostly treading water after a weather-related rebound in June. Flat is better than down but there are no indications of a pick-up in underlying momentum,” said Hassan.
Major electronics retailers including Harvey Norman and Dick Smith both recently reported higher sales compared to Fy13, with Gerry Harvey in particular confident of future growth amid the housing boom, last week.