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Economy in Brief


Disappointing Retail Sales In New Zealand

by Louise Curley September 14, 2009

Retail sales in New Zealand fell 0.46% in July, contrary to expectations of a rise. Moreover, June sales were revised downward from a 0.1% increase to a 0.06% decline. The upturn in sales in April and May has fizzled out as can be seen in the first chart. Excluding motor vehicles and related sales, sales were down 0.49% indicating that vehicles and related sales increased slightly. Among the few other areas where spending increased were fresh produce, clothing, and recreation all of which represent relatively small portions of total sales. Among the biggest losers were the more important supermarkets and department stores, which declined 0.3% and 2.0% respectively.

Retail sales have become a less reliable indicator of total consumption over the years as can be seen in the second chart that shows the ratio of retail sales to total private consumption in the National Accounts. In the last ten years the ratio has dropped from .62 to .51. New Zealand has yet to release national account data for the second quarter. In spite of their diminished importance in total consumption, the retail sales data suggest that consumption has added little to the economy in the second quarter and so far in the third quarter.

NEW ZEALAND Jul 09 Jun  09 Jul 08 M/M %  Y/Y % 2008  2007 2006
Retail Sales (Millions NZ$)                
Total 5392 6417 5485 -0.46 -1.70 65847 65071 61329
Fresh Produce 87 85 79 2.35 10.13 911 893 921
Recreation 203 196 188 3.57 7.98 2276 2358 2197
Clothing 212 209 221 1.44 -4.07 2578 2594 2445
Supermarkets 1293 1297 1180 -0.31 9.58 14369 13518 12587
Department Stores 299 305 329 -1.97 -912 3855 3770 3570
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