New Zealand Retail Sales Unchanged in November

New Zealand's Retail Sales surprised to the upside, printing unchanged in November from the previous month. Economists had predicted sales would fall -1.2%. Steep interest rate cuts, tax cuts, and lower gas prices all contributed to stabilizing spending activity. The Reserve Bank of New Zealand has cut benchmark borrowing costs by 3.25% since July, the government cut income taxes for the first time in nine years in October, and crude oil has fallen close to 70% to date since peaking at $147/barrel. Supermarket and grocery store sales (which make up about 20% of all retail spending) led the gainers, adding a healthy 2.6%. On balance, traders are unlikely to see retail activity gain significant momentum going forward as rising unemployment and falling house prices discourage spending. Indeed, consumer confidence fell 3.34% over the fourth quarter according to an index compiled by the Westpac Banking Corp.

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