Discretionary spending as measured by electronic transaction processing company Paymark has fallen under the level it was at a year ago for the second month running.
The discretionary goods category, covering retail outlets excluding food, alcohol and petrol stations, dropped in February and March to 0.4 per cent below thelevel it was at a year earlier, Paymark said today.
It had been growing at an average of 0.9 percent a year since 2008.
Despite the fall last month, the overall value of transactions through the Paymark network was 4.2 per cent higher than a year earlier.
Paymark head of sales and marketing Paul Whiston said that with necessities such as food and petrol becoming more expensive, people were having to make difficult choices.
People were also paying down debt rather than spending money they had left over.
Food and liquor categories were up 10.1 per cent from a year earlier, while accommodation and restaurant spending lifted 2.3 per cent.
Furniture and floor covering outlets were down 5.9 per cent on a year earlier, recreational goods retailers fell 4.8 per cent, and clothing retailers slipped 0.2 per cent.
The Paymark figures show that six weeks on from the February 22 Christchurch earthquake, spending in Canterbury continues to recover.
In the week of the major earthquake, sales for the region as a whole dropped to 31 percent below levels of a year earlier. By the week ending March 27 the decline had narrowed to 3 percent.
Mr Whiston said that while higher spending had been evident in South Canterbury and other parts of the South Island, the net impact of the earthquake was that national annual growth rates were probably around 1 percent lower than otherwise might have been expected in February and March.
"While this paints the national totals in a brighter light, it does not change the fact that spending in many sectors remains constrained."
