Retail slumps
Retail turnover fell by -3.9 per cent in December on a seasonally adjusted basis, while retail volumes were negative over the quarter at -0.2 per cent.
And this was is in spite of a blisteringly high rate of population growth over the quarter.
This will be a drag on GDP for the final quarter of 2022.
Source: ABS
The retail report would have been considerably worse if it hadn't been propped up by a strong quarterly boost to food retail volumes as travel tourism ramped up.
Department store and clothing sales were walloped towards the end of the last calendar year, and it looks as though as Australia is following the same downward trajectory as other advanced economies for its retail outlook.
Demand for durable and other household goods, clothing, and footwear etc. is all falling away, which in turn means that price pressures should ease in due course (if not already underway).
Econo-whizz James Foster noted:
"The retail price deflator saw its slowest quarterly rise in a year (1.1%) reflecting the effects of Black Friday discounting and falls in fruit and vegetable prices".
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Other figures from the ABS showed total wages paid dropping back over the most recent month, and a meagre 3.6 per cent lift over the year.
Source: ABS
Estimates from Westpac show how total population growth in Australia is now running at record highs, and looks as though growth may well top +500,000 per annum (including the natural growth in the population, being births minus deaths).
Source: Westpac
There's no way the increasingly sluggish economy can or will create enough jobs to match this record high growth in the working age population, and the unemployment rate will begin to rise in 2023.
This will in turn help with the inflation battle, with little risk of wages growth rising much above 4 per cent, before excess labour supply puts downward pressure on wages again.
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You can read Westpac's population report here.
You can also read James Foster's retail report here.
