New Zealand’s retail sales rise sharply in Q2

New Zealand’s retail sales volumes rose sharply 2.3 percent quarter-on-quarter in seasonally adjusted terms in the second quarter, strongest quarterly growth since the fourth quarter of 2006. This is quite stronger than the consensus expectations of 1 percent growth. Meanwhile, core sales, which exclude motor-vehicle related spending, rose sharply by 2.6 percent on sequential basis, with growth widespread through industries.

Out of 15 retail sectors, 12 registered higher sales volumes. Building and garden supplies, and hardware led the way, growing 5 percent quarter-on-quarter. Strong growth was also seen in pharmaceutical and other store-based retailing and motor vehicle sales. On the contrary, accommodation retailing dropped 1.7 percent quarter-on-quarter. But food and beverage services rose 3.3 percent quarter-on-quarter.

Region wise, Auckland continued to outperform. On a nominal basis, sales in that region rose 2.7 percent quarter-on-quarter and 9.5 percent year-on-year. But, the most rapid quarterly growth was witnessed in Wellington that registered growth of 4.5 percent. On the other hand Canterbury recorded flat growth on sequential basis, while on an annual basis sales dropped 2.9 percent.

“Today’s figures add to other evidence (although not across the board) suggesting strong Q2 GDP growth. Our forecast remains 0.8 percent q/q, although we wouldn’t rule out something in excess of 1.0 percent”, said ANZ in a research report.