Retail spending rises for third month as Kiwis lift August card use

Retail spending has increased for the third straight month, with the largest increase in the calendar year. Photo / 123rf

Retail’s long hoped-for revival may be gaining steam, with Kiwis spending more for the third month straight according to Stats NZ.

Electronic card transactions in the retail industries increased by 0.7% or $45 million in August 2025 compared to July. That’s the largest increase in 2025.

Spending in the core retail industries also increased in August, up 0.9% or $55m.

Apparel had the largest increase for the month, with spending up 1.8% or $5.9m.

Hospitality had its largest increase since November 2024, up 1.4% or $21m.

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."

Tom Raynel is a multimedia business journalist for the Herald, covering small business, retail and tourism.