Retail sales were up 0.8 per cent month on month in February – the biggest monthly rise in spending since November 2017, according to the National Retail Association.
NRA CEO Dominique Lamb said this shows consumer confidence is “heading in the right direction”.
“It has been a very sluggish period for retail and these figures serve as a giant morale boost to businesses across the country,” she said.
The monthly sales increase, based on the latest ABS Retail Trade figures released on Wednesday afternoon, follows a 0.1 per cent monthly rise in January.
Retail sales increased in February by a solid 3.17 per cent year on year, according to the Australian Retailers’ Association, with only the Northern Territory seeing a persistent decline in sales.
ARA executive director Russell Zimmerman said the trade figures were pleasing, but he cautioned they are likely to have been affected by a number of one-off and seasonal factors.
According to Zimmerman, the 4.88 per cent year-on-year rise in food retailing was driven by an increase in food prices due to the droughts and floods that have been impacting different parts of the country recently.
“[T]his makes some food items more expensive…and this has in all likelihood contributed to the rise in food trade,” he said.
He also attributed the 1.98 per cent month-on-month increase in clothing, footwear and personal accessory retailing and 3.56 per cent month-on-month increase in department store sales to the start of consumer spending on new season items ahead of winter.
Zimmerman expressed concern, however, about the continued decline in foot traffic in shopping centres, according to recent ShopperTrak data.
“The thing that worries me is we’re still seeing very soft foot traffic…that’s a concern,” he told IR.
But overall, he said, the figures suggest consumers are spending with more confidence, which is good news for retailers.
Across the country, the ACT recorded the highest year-onyear increase in retail sales at 5.35 per cent, followed by Victoria at 4.21 per cent, Queensland at 4.15 per cent, Tasmania at 2.92 per cent, NSW at 2.45 per cent, WA at 2.02 per cent and SA at 1.89 per cent.
Retail sales declined in the Northern Territory 2.14 per cent in February compared to the same period last year.