National retail spending saw a steady increase of 3.4 per cent year-on-year in May 2016, according to the latest Australian Bureau of Statistics figures.

Total retail spending, seasonally adjusted, was $25.02 billion in May 2016, up from $24.98 billion in April, representing a 0.2 per cent increase on a monthly basis.

Russell Zimmerman, ARA Executive Director, attributed the rise to sales activity retailers offered discounts in order to move winter stock as a result of late warm weather.

“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,” he said.

“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.”

Tasmania saw the highest rate of growth, at 5.2 percent, followed by Victoria at 4.9 percent and NSW, 4.8. Category-wise, other retailing showed the top rate of growth at 5.9 percent, buoyed by strong sales of recreational goods and pharmaceuticals, cosmetics and toiletries.

Year on year, seasonally adjusted, there were increases in food, 2.4 per cent; household goods, three percent; clothing, footwear and personal accessories, 3.4 percent; department stores, four percent; other retailing, 5.9 percent; cafés, restaurants and takeaway foods, 3.9 percent.

The other standout category of the month was department sales, clocking a four percent increase on the previous year. Supermarket sales remained soft at two percent, as a result of intense competitions between the majors and deep discounts lead by Aldi, Zimmerman said.

The outcome of the Federal election would likely have an impact on retail confidence, should a minority Government occur, according to Zimmerman.

“There is no doubt that during the minority Government of 2010 to 2013 we saw very soft retail growth.

“Whatever the outcome should be, the ARA believes that the winner and those that underpin and support the Government must ensure a strong focus on economic growth,” he said.

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