Growth, inflation and labour market all easing
January’s cashless retail result represents respectable growth, following significant volatility late last year.
January’s cashless retail result represents respectable growth (up 1.5% m/m on our forecast of the ABS measure), following significant volatility late last year. It is fair to say that these results further underline our view that the Australian economy starts 2021 in an enviably strong position, particularly given global events. While there have been several small (so far) quarantine outbreaks this year, Australia’s control of coronavirus has allowed consumers to have the confidence to spend on retail.
In aggregate terms, the retail sector has seen higher spending since the pandemic began, although spending has been unevenly distributed and at times quite volatile. The composition of retail spending has also changed, with household goods, department stores and other retail strong performers, while cafes, restaurants and takeaways (which was the consistently strongest performer in the index) and clothing and footwear continue to struggle.
Western Australia is the fastest growing state, with cashless retail sales up over 23% year on year. while Queensland and South Australia share equal second place. (up just under 20%), followed by Victoria (18.1%) and New South Wales on 16.9%.
For more information, please see the NAB Cashless Retail Sales Index January 2021
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