Car sales up but core retailing down in latest figures

Car sales recorded the highest rise in latest retail figures. Picture / Greg Bowker

Seasonally adjusted retail sales remained unchanged in August compared to July, bang on economists' predictions.

Figures out today from Statistics New Zealand (SNZ) showed that, excluding the vehicle-related industries, sales for the core retailing group fell 0.6 per cent ($21 million) in August.

Motor vehicle retailing was the subgroup recording the highest rise for the month, up 3.7 per cent ($24m) influenced by steady new vehicle sales.

Actual retail sales for the year were up 2.9 per cent, higher than the 2.4 per cent median prediction in a Reuters poll of economists.

There had been concerns a particularly strong result today could increase chances of the Reserve Bank raising official interest rates later this month.

The unchanged August monthly figure followed monthly increases of 0.5 per cent in July and 0.2 per cent in June.

Apart from motor vehicle retailing, the hospitality industries -- including cafes and restaurants, bars and clubs, and accommodation -- were the only other group to record a seasonally adjusted rise of over $10m for August, SNZ said.

Sales for the three industries recorded an increase of 2.5 per cent ($15m).

Falling sales were more widespread with largest dollar-value decreases being in recreational goods retailing, down 7.5 per cent ($15m), and department stores which were down 3.9 per cent ($12m).

While the total retail sales trend had continued to increase since May 1998, the rate of increase had eased in the past year, reducing to a monthly average of 0.3 per cent since July 2005.

That compared with an average increase of 0.6 per cent between May 2003 and July 2005, SNZ said.

Despite motor vehicle retailing being up in August, the trend for the group had continued to decrease in the past 18 months, falling 8.7 per cent since January 2005.

The rise in the hospitality industries coincided with an increase in short-term overseas visitor arrivals and a rise in total guest nights in short-term commercial accommodation.


Trends for both bars and clubs, and for cafes and restaurants had steadily increased since May, following a slow period earlier this year.

The trend in department stores had reached a turning point, with consecutive declining movements since April, with the monthly sales trend decreasing 2.1 per cent over the four months to August, SNZ said.

Geographically, the largest August sales increase was in Auckland, up 0.8 per cent ($13m). Waikato was up 0.5 per cent, Wellington up 0.6 per cent, and the remainder of the North Island down 0.5 per cent. Canterbury sales were unchanged, with the rest of the South Island down 0.9 per cent.

- NZPA