Data from the Australian Bureau of Statistics (ABS) has found a 3.8 per cent lift in retail spending in April year on year. 

Cosmetics, sports and household goods saw the highest increase at 5.3 per cent, with a 4.2 per cent rise in spending on food, and 3.9 per cent at on cafes, restaurants and on takeaways.

Cost-of-living pressures and economic uncertainty continued to impact consumer behaviour in April, despite spending being above last year’s levels, said Chris Rodwell, CEO of the Australian Retailers Association (ARA).

Online food sales rose by 4.5 per cent, while online non-food sales fell by 1.1 per cent. 

“Retail spending in April appears weaker than it truly is, likely due to calendar anomalies (Easter, school holidays, Anzac Day) and unseasonably warm weather, which particularly impacted sales in clothing, footwear and department stores,” said CreditorWatch’s chief economist, Ivan Colhoun.

“The modest rate cut from the Reserve Bank of Australia in May will help bolster consumer confidence in the coming months,” said Rodwell.

“However, we need to see substantially more cash rate reductions to generate the kind of retail recovery Australia needs. That’s why we urge the RBA to stay vigilant to opportunities to provide further relief,” he said. 

Rodwell called for productivity measures, reduced red tape and the implementation of policies to support the sustainability and growth of retailers as they grapple with increased rent, wages, energy, and insurance costs, and supply chain instability. 

“Geo-political tensions created by the US tariffs are impacting business and consumer confidence, and we need to see a robust response from the government to keep our Australian retailers stable, productive and competitive through this challenging period,” said Rodwell.