Retail Trade Makes A Major Recovery, Up A Record 16.3%
According to the ABS’s preliminary retail trade figures for May, Australian retail turnover rose by 16.3%, though this followed the largest ever fall of 17.7% in April. Year-on-year, retail turnover was up 5.3% in May 2020.
The most significant increases were recorded in those retail industries that recorded particularly low levels of trade in April.
These included clothing, footwear and personal accessory retailing, and cafes, restaurants and takeaway food services, supported by the easing of COVID-19 restrictions in May.
In addition, there was a notable boost in household goods retailing, with retailers reporting an increase in spending on goods related to homes, such as furniture, home entertainment, home offices, and home improvement. This is in line with the surge in sales seen at JB HI-FI, The Good Guys, Harvey Norman, Bunnings, and Officeworks.
Food retailing also increased, as households continued to consumer more food and beverages at home than usual. In particular, liquor retailing remained high, as COVID-19 restrictions on bars, clubs, and events were still in place.
The ABS preliminary retail trade figures point to the beginning of a sector recovery, a trend that has been mirrored in the ANZ-Roy Morgan Consumer Confidence index.
“Confidence resumed its climb last week, with a modest gain. Confidence in future financial conditions is now back to the early March level, which is a solid turnaround given the impact the pandemic lockdowns have had on employment and wages,” said David Plank, ANZ Head of Australian Economics.
“The contrast we expect to see between the May labour market and retail sales data may confuse the picture somewhat, but the continued easing in the lockdowns seems likely to be a positive force for sentiment for now.”