Via Westpac:
Retail sales surprised significantly to the upside in February, a 0.8% gain coming very much against the run of play. Sales had risen just 0.1% in January after a 0.4% fall in December with very weak private sector business surveys suggesting conditions had remained difficult in February as well. The sales data instead showed a strong and relatively broad based gain, well above consensus forecasts of a 0.3% increase and taking annual sales growth back above 3% for the first time since October.
Some of the gain may be due to problems with adjusting for changing seasonality – the rising popularity of ‘Black Friday’ sales and shifting timing of post-Christmas sales has created some issues around retail estimates through this period. However, to the extent that this means the February gain is overstated it also implies that previous weakness was also being overstated.
