New Zealand retail spending on credit and debit cards rose in March, led by increased expenditure at bars and restaurants as they continue to enjoy the tourism boom.
Retail spending gained 0.1 per cent, seasonally adjusted, in March from February, while actual sales were up 6.2 per cent to $4.95 billion from the same month a year earlier, Statistics New Zealand said. Stripping out spending on fuel and vehicle, core retail spending was up 0.2 per cent in the month.
Hospitality led the monthly gain, rising 0.4 per cent, and was up 12 per cent from March 2015 at $924 million. Retail and accommodation spending was one of the major limbs of economic growth in the December quarter as record visitor arrivals bolstered the country's tourism spend.
"The surging tourism sector continues to shine through, even in this softer month," ASB Bank economist Kim Mundy said in a note. "This strength is particularly evident in annual hospitality growth spending, which is sitting around a whopping 12 per cent."
Today's figures show spending on consumables, the biggest component, increased 0.2 per cent in March, and was 6.6 per cent higher than a year earlier at $1.81 billion.
Spending on durables edged up 0.1 per cent in the month, for a 6.2 per cent increase on the year to $1.16 billion. Apparel spending dropped 2.3 per cent in March and was up a more modest 3.5 per cent on the year to $292 million.
Spending on petrol rose 0.3 per cent in the month, ending two months of declines, and was down 1.7 per cent from a year earlier at $598 million. Expenditure on vehicles shrank 0.5 per cent in the month and was 6.5 per cent higher than a year earlier at $160 million.
Card spending on services, spanning everything from repairs and maintenance to funerals, fell 0.6 per cent in March, for a 6.3 per cent increase on the year at $246 million, while non-retail industry spending shrank 0.2 per cent in the month and was 5.1 per cent higher than a year earlier at $1.43 billion.
Total spending on electronic cards rose 5.9 per cent to $6.62 billion in March from a year earlier, across 133 million transactions, up 6.5 per cent on the year.
This strength is particularly evident in annual hospitality growth spending, which is sitting around a whopping 12 per cent.
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Electronic card spending increased 1.3 per cent in the March quarter and was up 0.3 per cent in the month of March, according to Paymark figures.
The figures show spending momentum of recent years has continued into 2016.
Paymark CMO Tim McFarlane said commentators have pointed to factors such as rising GDP and incomes, strong immigration and tourism, and higher house prices as contributing factors.
The largest increases were seen in the accommodation sector and trade supplies, furniture and hardware merchants.
The highest annual underlying spending growth was more than 13 per cent in the Bay of Plenty, but slowed below the national average in Auckland/Northland, Wellington and Canterbury.