Australia’s April retail sales report will be released on Tuesday.
After a weak result in the March quarter of this year, seeing real, inflation-adjusted retail sales go backwards for the first time since the middle of 2016, another soft spending update is expected today.
Some are even forecasting an ugly decline in retail turnover compared to the levels seen in March.
Here’s the state of play.
- In March, sales rose 0.3%, slightly ahead of expectations for an increase of 0.2%. Excluding food sales, turnover rose also rose by 0.3%. Non-food sales are regarded as a better guide on discretionary spending patterns at retailers.
- February’s lift in sales, initially reported as a gain of 0.8%, was revised up to 0.9%.
- From a year earlier, sales rose by 3.5%, the fastest increase since October 2018. Non-food sales increased by 2.9%, also the fastest pace since October last year.
- Despite the strength in nominal spending in both February and March, the increase reflected higher prices rather than increased turnover. Real retail sales fell in the first three months of the year, logging the largest quarterly decline since Q3 2012.
- In April, the median economist forecast offered to Bloomberg looks for nominal sales to increase by 0.2%, Individual forecasts range from a decline of 0.3% to a gain of 0.3%.
- The National Australia Bank (NAB) is the most pessimistic forecaster, reflecting that its Cashless Retail Sales Index plunged in April. This alternate measure on retail turnover has a reasonable track record for predicting movements in the official ABS measure.
- “The data suggests there was widespread weakness in spending, particularly in the household goods sector,” the NAB wrote ahead of the ABS April retail sales update.
- The April retail sales report will be released at the same time as several Australian partial GDP indicators, including net exports and government demand in the March quarter. The RBA’s June interest rate decision will also arrive later in Tuesday’s session, something to keep in mind for anyone trading around the retail sales report.
The retail update will be released at 11.30am AEST.
Business Insider will have all the details, including any ramifications on the outlook for RBA monetary policy settings, once the report is out.
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