The latest Australian Bureau of Statistics retail sales figures, released today, show a further slide in consumer spending year-on-year, as rising interest rates and petrol prices take their toll.
While overall figures remained flat, with seasonally adjusted turnover estimates for March sitting at just 0.5 per cent growth, the monthly turnover trend estimate graph showed a continuing decline in sales growth, almost perfectly corresponding with interest rate rises.
From a high of approximately 0.8 per cent monthly growth for the sector in July to August last year, growth has dropped steadily to its current estimate of below 0.2 per cent. The first of the recent interest rise hikes came in July 2007.
As reported on current.com.au, Australian National Retailers Association chief executive, Margy Osmond said retail spending had “well and truly come off the boil”.
“After a strong 2007, consumers are now much more cautious,” she said.
“Interest rate increases, with the prospect of more to come, and higher fuel prices have hit consumer confidence. Many people are seeing their disposable income dry up.
“During the first quarter of 2008, retail activity has been flat across nearly all retail industries.
“Across the states, activity is particularly weak in New South Wales. In Victoria and Western Australia, sales improved slightly in March after very poor results in February. But overall there are no star performers in this sluggish market.
“The next key set of numbers for the sector will be the Federal Budget. Income tax cuts will be welcome for shoring up consumer confidence but there are challenges ahead for the sector.”
The gloomy data was backed up by the latest ANZ job advertisements index, which, while recording a 3.1 per cent rise in total internet and newspaper job advertisements in March, hinted at slowing momentum and "a slowdown in the monthly trend rate of growth in employment", according to ANZ deputy chief economist, Tony Pearson.