Hospitality sector drives retail growth
New Zealand retail sales grew faster than economists were picking in the second three months of the year, led by record gains in the hospitality sector.
The total volume of retail sales rose a seasonally adjusted 1.7 per cent to $17.94 billion in the three months ended June 30 up, from a 0.9 per cent pace of growth in the first quarter, according to Statistics New Zealand.
That beat the 1.25 per cent growth expected in a Reuters survey of economists.
Actual retail sales volumes rose 4.2 per cent in the June quarter from the same period a year earlier.
Food and beverage services industries, which consist of cafes, restaurants and bars, led gains, reporting an increase of 4.5 per cent to $1.8b, seasonally adjusted, making it the sector’s biggest quarterly jump since the series began in 1995.
The value of spending on hospitality rose a seasonally adjusted 0.9 per cent to $18.14b.
“A record increase in the food and beverage services industry topped off the widespread rise of consumer spending,” industry and labour statistics manager Blair Cardno said.
The New Zealand dollar rose to 79.82 US cents from 79.62 cents immediately before the numbers were released.
Electronic cards data, which accounts for about two-thirds of retail sales, had already indicated household spending will likely make a bigger contribution to economic growth in the second quarter.
Inflation figures showed retailers trimmed their level of discounting in the quarter, with 14 per cent of stock sold at a lower price compared to 16 per cent in the March period.
The volume of core retail sales, which strip out vehicle-related spending, rose 2.3 per cent to $13.95b in the quarter.
Spending on hardware, building and garden supplies rose 3.7 per cent in volume terms to $1.33b while furniture, floor coverings, houseware and textile spending advanced 5.4 per cent in volume to $502 million.
Auckland was the biggest gainer across the regions closely followed by a 5.1 per cent lift in Canterbury.