Retail sales beat expectations

Mark MulliganMarkets and economy reporter


Retail sales were bolstered by higher spending on clothes and shoes.

Australians continued to spend more on household items, electronics, clothing and footwear in October, although the rate of growth across all retail categories slowed to 0.4 per cent from an unusually high 1.3 per cent in September.

The Australian Bureau of Statistics said on Thursday that its monthly estimates of retail sales showed a 1.4 per cent jump in turnover on household goods such as furniture and appliances, and a 1.1 per cent rise in spending on clothing, footwear and personal accessories. Across all categories, the month-on-month increase was 0.4 per cent, which equates to 5.7 per cent for the 12 months to the end of October.

The growth was higher than the 0.1 per cent increase expected by the market, and will come as good news after Wednesday’s release of soft gross domestic product figures.

It follows a 1.3 per cent rise in retail turnover in September, attributed partly to the launch of the latest Apple iPhone.

The worst-performing category in October was cafes, restaurants and takeaway food services, which slumped 2.1 per cent.

ANZ said in a note that sales of electronic goods including the iPhone 6 continued to drive turnover, posting a “surprising” 1.6 per cent increase, after the category surged 9.4 per cent in September.

Excluding electronics, retail sales growth was 0.3 per cent for the month.

“There was strength in clothing, which likely reflects a boost from a lower Australian dollar and warmer-than-usual weather,” said ANZ.

“Department stores sales were also solid at 2 per cent.

“In combination with last month’s numbers, it looks as if retail sales momentum has picked up,” the bank said.

“As yesterday’s national accounts showed, however, overall consumer spending growth remains relatively soft, with slow growth in household incomes weighing on spending.” Business News.