Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Monday, 6 February 2017

Low housing turnover depressing household goods sales

Slower December for retail

A weak result for retail trade for December with retail turnover down by -0.1 per cent in seasonally adjusted terms. 

The year-on-year growth in retail turnover is now down to +3 per cent, well below the half-decade average of +4 per cent. 

It wasn't all bad news, though, with retail trade in volume terms increasing by 0.9 per cent in the fourth quarter, a substantial improvement on the negative result which detracted from GDP in the third quarter. 

Southern states revival

It was another unusual month at the state level, with both New South Wales and Victoria going backwards, and the ACT doing the same after a bonanza 2016, but the southern states recorded gains. 

At the state level, therefore, Tasmania and South Australia now actually have the best year-on-year growth after a severely protracted lean spell. Good to see. 

Looking good, Australia!

At the industry level we can see that slower housing market turnover is depressing sales of household goods which dropped by 2.3 per cent in the month, while building and garden supplies dropped by 6 per cent.

Business Insider suggested that the closure of the Masters chain could have been a factor - I can go with that! 

The best performing sector was by far clothing and footwear, with online retail apparently making further inroads into the returns from department stores. 

Finally, have we reached peak avocado after a smashing run? Perhaps!

The wrap

A poor result for the month of December, no question.

But there won't be a technical recession in the fourth quarter based on recent numbers, which should be handy for consumer confidence (while the results for nominal GDP and national income should actually be very good).