New Zealand retail sales volumes lifted more than expected in the December quarter, boosted by spending on pharmaceuticals, duty-free goods, and food services

Retail sales volumes rose a seasonally adjusted 1.7 per cent in the December quarter from a revised 0.3 per cent gain in the September period, Stats NZ said. That's higher than the 0.5 per cent gain expected by economists.

In reaction, the New Zealand dollar rose to 68.61 US cents from 68.41 cents just prior.

Robust spending over the December 2018 quarter led to 11 of the 15 retail industries recording higher sales volumes, Stats NZ said.

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Sales volumes grew a record 8.2 per cent for pharmaceutical and other store-based retailing while food and beverage services lifted 4.2 per cent. However, these large increases followed sizeable falls in the September 2018 quarter for both industry groups, it noted.

"Increased visitor numbers to New Zealand could be a factor in higher sales for both of these industries, such as sales for duty-free outlets and food service operators," retail statistics manager Sue Chapman said.

More than half a million visitors arrived in New Zealand in December 2018, breaking the previous December 2017 monthly record.

In the other direction, the largest falls in volume sales were in hardware, building, and garden supplies, down 2.1 per cent, and department stores, down 2.6 per cent, in the December 2018 quarter.

When the effects of price changes are included, the seasonally adjusted value of total retail sales rose 1.8 per cent, or $432 million, in the December 2018 quarter, after a 0.8 per cent, or $192 million, rise in the September 2018 quarter.

In actual terms, the value of total retail sales was $26.3 billion in the December 2018 quarter, up 4.5 per cent, or $1.1 billion, on the December 2017 quarter.

- BusinessDesk