Retail sales crept up in January, ABS data shows

(Source: Big Stock)

Australian retail sales inched higher in January, with food-related spending leading the growth.

Australian Bureau of Statistics data showed that January retail sales rose 1.1 per cent on a year-on-year and month-on-month basis.

“The rebound in January follows a sharp fall in December when consumers pulled back on spending after taking advantage of Black Friday sales in November. Retail turnover is now back at a similar level to September 2023,” said Ben Dorber, ABS head of retail statistics.

“Retail turnover was unchanged in trend terms in January. This means there has been no growth in retail turnover when we look through the volatility of the past few months,” Dorber said, noting that spending patterns shifted due to change in seasonality.

‘Other’ retailing sales climbed 2.8 per cent annually to $5.53 billion. Cafes, restaurants, and takeaway sales grew 2.5 per cent to $5.38 billion while food sales went up 1.9 per cent to $14.23 billion. 

Meanwhile, clothing, footwear, and accessories fell 1.7 per cent to $2.93 billion. Household goods declined 1.4 per cent to $5.77 billion and department stores slid 1.3 per cent to $1.88 billion.

“The biggest discretionary categories, clothing, household goods and department stores, all suffered a decline as Australians tightened their purse strings amid the cost-of-living crunch,” Australian Retailers Association CEO Paul Zahra said.

“Shoppers are continuing to feel the impact of the cost-of-living challenges and interest rate increases, making it a difficult time to be a discretionary retailer.”

Tasmania and the NT saw the highest spending growth of 2.8 per cent to $726 million and $324 million, respectively.

Queensland’s turnover grew 2.6 per cent to $7.37 billion while SA rose 2.2 per cent to $2.32 billion and WA climbed 1.8 per cent to $3.98 billion.

The ACT jumped 1 per cent to $669 million and Victoria slightly improved 0.8 per cent to $9.19 billion.

Despite NSW booking the largest turnover of $11.14 billion, it was the only state that suffered a decline, with sales dipping 0.3 per cent.

Zahra said that ARA hopes the Reserve Bank of Australia will pause interest rate hikes again in its March 19 decision.

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