- Kate Hickie, Capital Economics
Australian retail sales posted a surprise fall in the last month of 2016, official figures revealed this morning. The Australian Bureau of Statistics reported retail sales dropped 0.1% to $A25.61 billion on a seasonally adjusted basis in December, following the preceding month's downwardly revised gain of 0.1% and missing analysts' expectations for a rise of 0.3% in the reported month. The December figure marked the first contraction since July 2016. In volume terms, sales jumped 0.9% in the Q4, up from the prior quarter's 0.0% and in line with analysts' forecasts. Thus, analysts suggest that consumer spending provided a big positive contribution to economic growth in the Q4 of 2016. In regional terms, retail sales declined 0.4% in Victoria, 0.3% in New South Wales and 0.7% in the Australian Capital Territory. These falls offset gains of 1.2% in South Australia, 0.6% in Western Australia, 1.1% in the Northern Territory and 0.5% in Tasmania. Sales were unchanged in Queensland. The largest drop of 2.3% was recorder in household goods retailing. The ABS said that the fall was mainly driven by a sharp 6.6% decrease in sales of hardware, building and garden supplies. It was the biggest monthly decrease in this category since July 2000. Economists suggested that the following plunge was largely due to the closure of the Masters hardware chain.
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