Published on 04/03/2016 by Punchmedia

Retail Results Surprise

Strong household goods spending has seen Australia's retail sales growth arrive just below consensus expectations at 0.3 per cent for January.

The January figures come after retail sales in December showed zero growth, missing expectations for a rise of 0.4 per cent.

Total retail spending was $24.83 billion in January, up from $24.75 billion in December, with a 1.0 per cent rise in household goods spending behind the overall lift.

Capital Economics economist Kate Hickie said retail sales in Australia in January were slightly weaker than expected and suggested that consumption growth may have softened at the start of the year.

"Nonetheless, there is little evidence that the turmoil in financial markets is prompting households to adjust their behaviour much,'' Ms Hickie explained.

"At the least it suggests that the stagnation in December was probably a one-off rather than the start of a major slowdown. The key driver was the 1.0 per cent month-on-month increase in household goods.''

MS Hickie said the result reversed the 1.1 per cent month-on-month fall in December and suggested that decent housing market turnover was still supporting consumption.

AMP Capital chief economist Shane Oliver said the figures were fractionally less-than-expected, but still solid particularly given that retail price inflation remained low.

"While wages growth is low and confidence is running around average levels, retail sales appear to be benefiting from the boost to household spending power from low interest rates and low petrol prices along with solid jobs growth,'' he said.

The retail sales figures follow this week's stunning economic growth figures, which showed Australia's economy grew at 0.6 per cent for the December quarter. Coupled with a revision in third quarter growth from 0.9 per cent up to 1.1 per cent, that pushed annual GDP growth up to 3 per cent - the strongest rate since the first quarter of 2014.

Expectations were for only 0.4 per cent growth for the December quarter and 2.5 per cent for the year.

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Curtis is a leading expert in the business-for-sale industry, serving as a senior content creator at anybusiness.com.au.

With a career spanning over fifteen years, Curtis has accumulated extensive knowledge in the domain of business sales, acquisitions, and valuations. His deep understanding of market dynamics and his ability to translate complex industry jargon into accessible insights make him a trusted resource for entrepreneurs and business owners looking to buy or sell businesses.

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