‘Despite sharply rising ‘wealth’, today’s data suggests Q4’s stronger consumer is flagging, both a risk to the 2017 growth outlook, but also possibly signalling little inflation pressure in the Q1 CPI print due at the end of this month.’ – UBS
Australian retail sales dropped unexpectedly in February, generating major concerns about the outlook for the economy. According to the Australian Bureau of Statistics, sales fell 0.1% on a seasonally adjusted basis, following the previous month’s gain of 0.4% and falling behind analysts’ expectations for a 0.3% increase. February’s drop marked the second monthly decline in the last three months. The ABS said sales dropped 2.5% in clothing, footwear and personal accessory retailing and 0.4% in household goods retailing. Meanwhile, food and in department store sales advanced 0.3% and 0.8%, accordingly. The retail sales report measures broad consumer spending patterns, which accounts for more than half of Australia’s economy. Despite high construction activity, sales of household goods dropped 0.4%, following a 2.5% fall in the furniture, floor coverings, houseware and textile goods subcategory. In regional terms, sales declined 07% in Western Australia, 0.3% in Victoria, 0.2% in Queensland, 0.5% in Tasmania and 0.5% in the Australian Capital Territory, offsetting gains of 0.4% in in New South Wales and the Northern Territory and a 0.1% rise in South Australia. Growth in national sales over the last year dropped to 2.7%, the lowest in almost four years.
