Retail Spending Up For May

The NAB Online Retail Sales Index showed strong growth in May. Online retail sales grew 2.0 percent for the month, up from April’s relatively low growth of just 0.3 percent.

Year-on-year growth was at 13.2 percent for May, up from April’s 11.2 percent and in line with the March annual growth rate.

NAB
Source: NAB Online Retail Sales Index

According to NAB estimates, Australians spent $19.9 billion on online retail in the 12 months to May 2016. This is equivalent to approximately 6.7 percent of spending at traditional bricks-and-mortar retailers.

Fashion sales and games and toys were the two segments driving May’s strong online sales growth. Fashion sales expanded strongly in May (21.1 percent yoy compared with 8.6 percent yoy in April), as did sales for games and toys (41.6 percent compared with 16.2 percent yoy).

Homewares and appliances, the largest spend category, declined by 1.7 percent yoy.

Retail spending in May was bolstered by high consumer confidence, which bounced back from a six-month low in April.  Consumer-confidence

 

In terms of total retail spending, ABS figures show Australian retail turnover grew 3.3 percent year-on-year for May 2016.

Executive Director of the Australian Retailers Association, Russell Zimmerman, attributed the retail growth to discounts offered to counter the late start to winter.

“Most Australian states witnessed a very late start to winter this year, and the extra discounts on offer, combined with the beginning of mid-year sales have been responsible for the bulk of May’s growth,” said Zimmerman.

“The blast of cold in the last week of May also served to drive retail spending, sending those who had previously held off on purchases of winter goods and clothing scurrying into stores.”

While retail results showed some good growth in May, the protracted election will likely have an impact on retail sales for July, with consumer confidence already falling from the highs of May and June.

 

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