There’s no budget emergency in Canberra, at least when it comes to retail sales.
Retail spending in the Australian Capital Territory (ACT) has surged of late, rising to $453.7 million in January after seasonal adjustments, the highest monthly total on record.
As the chart below reveals, spending has increased by $21.1 million over the past four months, leaving the annual percentage increase at 8.5%, the highest of any state and territory in the country.
While a low base effect contributed to the spike in the annual rate, it’s still a stellar level of growth nonetheless.
“ACT consumers are seemingly spending like there’s no tomorrow with sales now up 8.5% on a year ago – the strongest result in 8.5 years,” wrote Savanth Sebastian, economist at Commsec. “The result is even more astounding when you consider that annual growth in September 2015 was a paltry 1.7%.”
While there could be any number of factors to explain the sudden splurge, Sebastian reckons there may be a simple explanation behind the recent strength.
“It maybe that the new IKEA store had a part to play in the turnaround,” he said.
The Canberra store opened in November, coinciding with the surge in spending.
One look at the store reviews on Google suggests that locals have indeed embraced the land of flat-packs and endless aisles.
“Sunday morning at Ikea Canberra is hell on earth,” said one reviewer. “The monster crowds make the car park a nightmare.”
“I love the variety and the value for money you get at Ikea, although the queues can be large at times,” said another.
Clearly a popular place. Enjoy the meatballs.