Australian retailers enjoyed their best sales in February since late-2017 in a boon to economic growth in the first quarter, signalling surprising resilience in household consumption and sending the local dollar higher.
Retail sales climbed 0.8% in February, figures from the Australian Bureau of Statistics (ABS) showed on Wednesday, picking up from an unexpectedly weak 0.1% growth in January and well past expectations for a small 0.2% rise. February’s outcome was the best since November 2017 with sales fairly broad-based across food, department stores and household goods.
“A very solid outcome that gives the Reserve Bank some reassurance that household spending could bounce back in Q1 2019,” said Kaixin Owyong, Sydney-based economist at National Australia Bank. – “There may be some price impacts at play – food sales were unusually strong – but these data give the RBA room to remain on hold.”
Household DebtConsumer spending has been a major concern for the Reserve Bank of Australia (RBA) over the past year as households battle high levels of debt, slow pace of wage growth and a downturn in the country’s once-booming property market.
