Spending on consumables and durables also increased, up 0.3% ($7.1m) and 0.5% ($8.9m) respectively.
Fuel and motor vehicles (excluding fuel) were the only categories to decline, down 0.1% ($0.5m) and 0.9% ($1.7m).
The non-retail (excluding services) category increased by 0.2% ($4.3m) compared to July 2025.
That category includes medical and other health care, travel and tour arrangement, postal and courier delivery, and other non-retail industries.
Spending in the services category, which includes repair and maintenance, and personal care, funeral, and other personal services, was flat, up by $0.1m.
The total value of electronic card spending, including the two non-retail categories (services and other non-retail), increased from July 2025 by 0.4% or $41m.
In actual terms, cardholders made 174 million transactions across all industries in August 2025, with an average value of $54 per transaction.
The total amount spent using electronic cards was $9.3 billion.
Best result this year
Westpac senior economist Darren Gibbs said the result was a firmer outcome than they were expecting.
“Encouragingly, this marks the third consecutive monthly increase and is the largest increase seen this year,” Gibbs said.
“As a result, spending in the three months to August is 0.8% higher than in the preceding three-month period – the first positive quarter-on-quarter comparison since February."
Gibbs said the improving trend boded well for September’s quarterly GDP figures, particularly if the figures for June are as weak as expected.
He said that for many households, a fourth consecutive year of falling real house prices will be contributing to still slow levels of measured consumer confidence.
“In the near term, we expect that consumer spending is likely to remain somewhat patchy with spending appetites likely to remain weighed down by weak conditions in the labour market and the ongoing pressure on disposable income from large increases in the likes of local authority rates and utility fees.
“Barring no major unpleasant surprises from offshore – and we continue to monitor how US tariffs are impacting trading partner growth and commodity prices – we expect that the environment facing retailers will improve noticeably in 2026."
Retail NZ chief executive Carolyn Young said that while it’s too soon to say the retail sector has turned a corner, the data suggests that retailers may be starting to see some green shoots.
“We’re pleased to see there has also been a small increase in the number of transactions, suggesting that consumers are bringing their cards out a little more often,” Young said.
“We are hoping this will give retailers confidence to buy stock and retain staff in the run up to the end of the year. Consumers are continuing to be careful with their spending but we want to see these improvements continue during the coming months.”
She said some of the increase could be attributed to increasing prices, but the continued spending increase suggests that a turn-around may be starting.
Tom Raynel is a multimedia business journalist for the Herald, covering small business, retail and tourism.
