Aussie retail recession deepens as households buckle


Australia’s world-record decline in household disposable income continues to drag down retail sales.

Household disposable income

The Australian Bureau of Statistics (ABS) reported that the value of retail sales fell by 0.4% in March to be up only 0.8% year-on-year in nominal terms:

Retail sales summary

Most importantly, durable retail sales collapsed by 1.6% over the month to be down 0.4% year-on-year.

These are aggregate nominal figures. Thus, subtracting population growth of around 2.5% and CPI inflation of 3.6% means that retail sales have collapsed by around 5% in real per capita terms.

In his commentary accompanying the release, ABS head of retail statistics, Ben Dorber, was downbeat.


“Consumers pulled back on retail spending in March as cost of living pressures remained high”, he said.

“Underlying retail turnover has been flat for the past six months and was up only 0.8% compared to March 2023″.

“Outside of the pandemic period and introduction of the GST, this is the weakest growth on record when comparing turnover to the same time in the previous year”.

“Retailers told us that overall trading conditions remain challenging with consumers being cautious in their discretionary spending”, Dorber said.


This data is a clear shot across the bow of interest rate hawks.

The Reserve Bank of Australia will be reluctant to hike rates further with households stuck in recession.

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.