Cashless Retail Sales Index: February 2021
How will consumers respond as 2021 rolls on and the prospect of some kind of post-pandemic normality comes into view via vaccination?
- Our data mapping points to the ABS retail sales measure moderating in February – up 0.3% m/m in our estimation. The ABS measure has seen substantial volatility in recent months, reflecting in part a series of snap lockdowns across several states.
- February’s result is fairly good, although perhaps suggests that some of the outsized growth in household goods, department stores, other retailing and food since the start of the pandemic is now returning to more “normal” levels, with some downside risk to retail sales as a result.
- This is consistent with the February NAB Monthly Business Survey, which showed that retail conditions remained very strong, but with a decline in confidence.
NAB Chief Economist, Alan Oster commented
The onset of the pandemic has seen profound changes for Australian retail, with the sector in aggregate going from the weakest sector in the NAB Monthly Business Survey to one of the strongest. While some parts of retail (such as clothing and footwear and cafes, restaurants and takeaways) were hit hard, a surge in household goods and related spending saw big gains in the sector overall.
But as 2021 rolls on and the prospect of some kind of post-pandemic normality comes into view via vaccination, how will consumers respond? Early signs from NAB’s Cashless Retail Sales Index suggest that household goods and other retailing are returning closer to pre-pandemic growth, while food has now fallen to essentially pre-pandemic levels. Meanwhile, cafes, restaurants and takeaways continue to recover.
Western Australia remains the fastest growing state, with cashless retail sales up 22% year on year, while Victoria saw the slowest growth, reflecting the five-day circuit breaker lockdown. Higher frequency NAB consumption data suggest that Victoria has now snapped back, suggesting some upside for March.
For more information, please see the NAB Cashless Retail Sales Index February 2021