Australia’s retail sales report for November will be released later in the session. Following strength in online retail sales and economy-wide spending over the same period, economists expect another solid increase today, keeping with the theme seen in the past two months.
If correct, it would also help to alleviate concerns that a recent slowdown in Australian household consumption — the largest component within the Australian economy — is becoming entrenched.
Here’s the state of play.
- In October, nominal retail sales rose by 0.5% to $25.62 billion in seasonally adjusted terms, the highest monthly total on record.
- Sales increased for food (0.6%), household goods (0.7%), other stores (0.8%) and in cafes, restaurants and takeaway food services (0.4%), more than offsetting declines of 0.4% apiece for clothing, footwear and personal accessories and in department stores.
- By state and territory, sales increased in Queensland (0.8%), Victoria (0.5%), New South Wales (0.3%), Western Australia (0.4%), the Australian Capital Territory (0.9%), Tasmania (0.6%) and the Northern Territory (0.3%).
- At -0.1%, South Australia was the only state to record a decline in sales, an outcome that may have been impacted by adverse weather conditions at the time.
- Despite the strong lift in October sales, the annual pace of growth slowed fractionally to 3.5%. However, perhaps more reflective of recent strength, sales over the past three months rose at an annual pace of 6.8%.
- In November, economists expect retail sales to moderate slightly with the median forecast offered to Bloomberg centred around an increase of 0.4%.
- Forecasts range from flat growth to an increase of 0.7%.
- The National Australia Bank thinks that the risks today are slanted to the upside due to strength in online retail sales among other factors.
- “Major retailers reported solid sales in the lead up to Christmas, NAB’s online retail sales index was strong in November and there is some upside from the risk that the incorporation of major US shopping events in the Australian retail calendar is not being fully adjusted for by seasonal adjustment — this is what the UK Statistician reported in their November retail report,” said Tapas Strickland, an economist at the NAB.
- He looks for an increase of 0.7%, at the top end of economist forecasts.
- Economy-wide spending — as measured in the Commonwealth Bank’s Business Sales Index — was also strong in November, perhaps adding to the risk of a better-than-expected result in the official ABS report.
The data will be released at 11.30am AEDT.
Business Insider will have full coverage as soon as it hits the screens.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.