"Consumer spending is humming along, with DIY and trade staff customers boosting sales in the hardware and building supply trades".
-Neil Kelly, Statistics NZ business indicators
As latest data suggests released by Statistics New Zealand, the volume of retail sales rose a seasonally adjusted 2.3% in the three months through June from the March quarter, showing the biggest percentage increase since the December 2006. Moreover, this number is far ahead of the 0.9% forecast made by Reuters poll of economists. Retail sales volumes for the March quarter, in turn, were revised up to 1% from 0.8%. Core retail volumes, which exclude the vehicle-related industries, surged 2.6% in the June quarter. Meanwhile, volumes of hardware, building and garden supplies rose 5%, motor-vehicle and parts retailing gained 2.6%, pharmaceutical and other store-based retailing advanced 5.2% and food and beverage services went up 3.3%. The biggest drop, in turn, was seen in fuel retailing, which slipped 1%, and recreational goods, which lost 3.3%. Eventually, on an annual basis, the quarterly value of actual retail sales increased 5.5% to $19.9 billion, while the volume added 6%.
In the meantime, while New Zealand's economy rose faster than expected during the first quarter, weak inflation has lifted concerns about the country's outlook. Moreover, the Reserve Bank of New Zealand acted to the deflation risk on Thursday by lowering interest rates to a fresh all-time record low of 2%. Nevertheless, lower interest rates have not helped the RBNZ devalue Kiwi.
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