Yesterday, my esteemed and learned colleague, Houses and Holes, questioned whether retail sales are accelerating based on the recent improvement of sales growth over the past year.
Certainly, retail sales have climbed off the canvass, as illustrated by the below chart showing annual sales growth since 1998. A clear uptrend has developed over the past 12 months, albeit from a very low base.
When adjusted for inflation and population growth, however, retail sales growth remains fairly flat:
Clearly, retail sales have a long way to go to recapture the heady days pre-GFC, when sales were juiced by high rates of credit growth and ever-rising asset prices.
Twitter: Leith van Onselen. Leith is the Chief Economist of Macro Investor, Australia’s independent investment newsletter covering trades, stocks, property and yield. Click for a free 21 day trial.
