Brocker.Org: Australia retail sales preview – Goldman Sachs

0
10

Goldman Sachs’ economists offer a sneak peek into what to expect from the Australian retail sales due on the cards at 0130GMT.

Key Quotes:

“Nominal retail sales disappointed in February, falling by -0.1% m/m, well short of the +0.3% m/m gain expected by Bloomberg consensus

As a result, annual growth slowed to +2.7% y/y, its slowest pace since July 2013

Sales were weaker still on an ex-food basis (-0.4%mom, +2.0%yoy), with weakness concentrated in the clothing sector (-2.5%mom) and major states outside of NSW

In the context of an improvement in the overall growth outlook and labour market over the past few months, the weakness in February nominal sales was disappointing

Notwithstanding this, we remain cautiously positive on the outlook for broader consumer spending over the course of the year, given the lagged positive impact from the higher terms of trade, stronger leading indicators on employment and wages, and likely better fiscal news flow around May’s Commonwealth Budget

Looking to the March update, we expect nominal sales to rebound modestly by +0.3% m/m

Compositionally, we note that the unusually wet weather in Qld/NSW may have weighed on department stores and hardware sales over the month, while competition among supermarkets continues to exert pressure on food prices overall

For the March quarter as a whole, we expect sales volumes to expand moderately by +0.5% q/q

Expect retail prices to remain subdued (+0.0% q/q), as a result of ongoing competition”

 

LEAVE A REPLY

*