Retail party ends
Retail turnover got walloped in December as cost of living pressures began to bite, according to the ABS commentary, recording a far worse result than any of the expectations proffered by market economists.
Turnover was down -3.9 per cent for the month for one of the worst monthly declines on record.
A surprisingly huge percentage decline for the month, then.
The retail volumes for the final quarter of 2022 will warrant watching with interest, as this may go some way to shaping the narrative for the Reserve Bank of Australia's February meeting.
Credit slowing
In other news, credit growth also slumped to just 0.3 per cent in December.
Housing credit growth decelerated to just 0.3 per cent for the month.
Housing credit growth to property investors was dismal at just 0.26 per cent over the month of December, sowing further seeds of a dire rental crisis in 2023.
And the housing credit impulse took a further leg lower, with capital city prices now down by around -9 per cent, driven by prices in the top quartile of the housing market.
The wrap
Overall, these were extremely soft retail numbers as compared to market expectations, and this was the biggest percentage monthly decline on record, COVID lockdowns excepted.
Even allowing for some pull forward from the Black Friday rush in November, this was more than 3x as large a decline as the lowest of the market forecasts.
The party is over for retail, with anecdotal evidence also pointing to ongoing weakness in household goods in January.
