Growth, inflation and labour market all easing
The retail sector has proven to be very resilient this year, although many consumers have changed their spending behaviour, leading to a boom for some retailers and bust for others.
This month we continue our podcast series to accompany the NAB Cashless Retail Sales Index. It’s a short, 10 minute podcast, designed to give you a quick summary of the major drivers of the index this month. Listen to the full podcast now. If listening on a mobile device, click listen in browser.
The retail sector has proven to be very resilient this year, although many consumers have changed their spending behaviour, leading to a boom for some retailers and bust for others. Businesses in CBDs, clothing and footwear retailers, hospitality and businesses dependent on international tourism have all faced major challenges.
The massive financial support provided by government has allowed many consumers to keep spending. However, this support is being gradually wound back despite unemployment remaining at an elevated level. NAB’s latest monthly business survey shows that while confidence has jumped, business conditions remain challenging, driven in part by weak employment.
With signs that outperforming retail sectors household goods and other retailing have peaked, we expect the sector to face ongoing pressure into 2021 as support decreases. The hospitality sector has been under pressure, particularly in Victoria, but if good coronavirus outcomes continue, there is a possibility of some upside driven by increased domestic tourism.
For more information, please see the NAB Cashless Retail Sales Index October 2020
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