Retail sales plunge to recessionary levels

The Australian Bureau of Statistics (ABS) has released retail sales figures for the month of June, which recorded a 0.4% rise in retail sales over the month in seasonally-adjusted terms, with annual sales growth rising to 2.5%:

However, in trend terms, annual retail sales growth fell to 2.7%.

In real chain volumes terms, annual retail sales plunged to 0.2% – the lowest recorded level since the early-1990s recession:

The below chart maps out nominal seasonally-adjusted sales growth by segment on a monthly, quarterly and annual basis, and shows huge variation:

Annual trend retail sales growth also shows a mixed bag:

The next chart shows seasonally-adjusted retail sales by jurisdiction on a monthly, quarterly and annual basis, which again shows significant variation across the nation:

Annual trend retail sales growth also shows significant variation across jurisdictions:

Finally, there is a reasonably strong correlation between dwelling value growth and retail sales owing to the wealth effect:

The turnaround in the housing market, if it persists, should put a floor under retail sales. However, with wage growth stuck in the gutter, credit availability remaining restricted, and unemployment worsening, the retail sector will remain under intense pressure.

Comments are hidden for Membership Subscribers only.