Interpac Business and Migration Solutions Melbourne Australia

December 3, 2009

Retail sales have rebounded from a small dip in September, with a modest rise of 0.3 per cent in October coming in right on expectations.

The seasonally adjusted Australian Bureau of Statistics figures estimate that Australians spent $19.75 billion in retail outlets during October.

Department stores had the biggest increase in sales (1.9 per cent), but also had the biggest fall (-2.3 per cent) a month earlier.

Cafes, restaurants and takeaway food outlets also recorded 1.1 per cent sales growth, but food retailing slipped slightly, as did clothing and accessory sales.

The more stable trend figure for retail sales slipped slightly to 0.2 per cent growth, whereas the trend for monthly retail sales growth earlier in the year was running at 0.6 per cent.

Most economists have attributed the slower sales growth to the end of Government cash stimulus payments and the rising level of interest rates.

Westpac's economists say the increasing spend on eat-out food, and the corresponding fall in food retailing, is a good indication that there is a "cyclical revival in discretionary spending", indicative of a broader economic recovery.

In its analysis of the figures, Westpac's economics team says sales are well above last year's level, even though the rate of growth is easing.

"Despite the soft outcome, monthly sales are still up 5.6 per cent on their October 2008 level - which predated the fiscal boosters and aggressive monetary easing."

(Source from ABC News)