New Zealanders are opening their wallets with retail spending up for the June 2016 quarter, rising at the fastest pace in close to a decade.

The latest Statistics New Zealand data showed sales were up 2.3 per cent - the largest increase since the December 2006 quarter and a record rise in dollar terms. Hardware, building and garden supplies led the rise, up five per cent.

Business indicators senior manager Neil Kelly said 12 of the 15 industries had higher sales volumes this quarter with some Auckland retailers in particular saying they had an extremely busy quarter.

"Consumer spending is humming along, with DIY and trade staff customers boosting sales in the hardware and building supply trades," Kelly said. "Strong vehicle sales also continued."


ASB economist Daniel Snowden said the data suggested inflation pressures were non-existent in the retail sector.

"Retail volumes were much firmer than expected in the June quarter following a slightly soft March quarter," Snowden said.

"Increased spending was seen in the majority of classes, although accommodation took a small step back, a surprise given the strength of tourism," he said.

"Spending in housing-related categories was firm, with consumers adding value to their already appreciating homes and furnishing them."

Motor-vehicle and parts retailing rose 2.6 per cent, pharmaceutical and other store-based retailing increased 5.2 per cent and food and beverage services jumped 3.3 per cent.

The biggest declines were in fuel retailing, which dropped one per cent, and recreational goods, which dropped 3.3 per cent.

On an annual basis, the quarterly value of actual retail sales rose 5.5 per cent to $19.9 billion, while volume rose 6 per cent.

Westpac's economics team attributed part of the strength in spending to the continued softness in prices, allowing households' pay packets to stretch further. It estimated that retail prices were down 0.2 per cent over the quarter, and 0.5 per cent over the year.

Spending has also been boosted by low interest rates, strong population growth, and high tourist numbers.