Retail spending saw a strong lift in January, even with COVID cases spiking. According to the Australian Bureau of Statistics, trade rose by 1.8 per cent, pushing turnover to $32.5 billion on a seasonally adjusted basis, which was 6.1 per cent more than the previous year.
That also made it the highest monthly figure since the $33.3 billion result in November.
That was followed by a drop of 4.4 per cent in December. Then, with Omicron growing, economists expected a modest spending recovery of 0.3 per cent in January, but high vaccination rates saw people out, boosting the economy.
Data suggests spending has risen further in February, even with the ongoing hikes in petrol prices.
ABS data also shows a 1.1 per cent rise in business inventories, suggesting the economy may have finished last year in stronger form than expected, and well ahead of forecasts, which suggests this Wednesday’s national accounts may reveal GDP heading higher than the expected three per cent in the three months to December, after Delta lockdowns in NSW, Victoria and the ACT resulted in an economic contraction of 1.9 per cent in the September quarter.
Still, the Reserve Bank is expected to hold rates at 0.1 per cent tomorrow when they meet, despite any chaos due to Russia invading Ukraine.
With some believing the conflict will have “minimal” impact on our economy, it is said the RBA will still hold off on increasing rates until June.
Even though the increase in COVID cases through summer kept Aussies out of cafes and restaurants, where spending dropped 0.8 per cent in January, with people staying home, as with previous virus spikes, food retailing jumped, going up 2.2 per cent, its biggest increase since July 2021.
Then, with the rise in vaccination rates, other retailing saw a 4.5 per cent leap, while department store spending lifted 4.9 per cent, along with a 0.6 per cent rise in household goods shopping.
These lifts occurred across the country, with COVID-free WA leading with a 4.7 per cent rise, 2.4 per cent in Victoria. Meanwhile, January saw a one per cent January rise in NSW, and 0.3 per cent in Queensland.