The sky may be about to fall on the country’s retailers, but it has not quite happened yet.Shoppers have been reining in spending this year, unnerved by mortgage rates and the steady bleat of anguish from the financial world. But the outlook for retailers brightened somewhat in March, with the value of sales climbing 0.5 per cent. Market economists expected a 0.2 per cent rise, so the evidence suggests some of the scarier recent headlines about retail pain might have been a bit overcooked. “Almost all of the bounce is due to food, which rose a massive 1.7 per cent in March,” said ANZ’s senior economist, Katie Dean. “This is the biggest monthly rise in food retailing in nearly five years and is almost entirely due to higher food prices, not volumes.” Sales of larger household items have been nudging on a downward trend for four months, while the hospitality sector has dipped after four years of relentless growth. “Higher costs of living and added higher interest rates are not going away any time soon. Consumers are continually adapting to the ongoing added stress on the household budget, and spending decisions are being re-evaluated to ensure the maximum benefit is obtained,” said an equities economist at CommSec, Savanth Sebastian. Sebastian said unpublished Bureau of Statistics figures showed cafes and restaurants had raised their prices by more than at any time in the past 17 years, while customers had cut back spending at food outlets sharply in the past three months. Sydney Morning Herald, May 3.
May 16
