Growth, inflation and labour market all easing
Our NAB Online Retail Sales Index data returned to more moderate growth in June.
NAB Chief Economist, Alan Oster commented:
Our NAB Online Retail Sales Index data returned to more moderate growth in June, from the contraction in May and record growth in the two months prior. While online retail sales growth is typically volatile month to month, the recent changes that COVID-19 has brought to the broader economy, and day to day life, has made it even more so.
While the smaller spend share category, games and toys, contracted in month-on-month terms, this category has performed strongly relative to the same period 2019. This category includes merchants such as online game subscriptions, which have proved popular in the current environment, in addition to physical goods such as puzzles. In month-on-month terms, growth was strongest for the second largest sales category, grocery and liquor. Given that this category has recorded consecutive monthly growth over the past 12 months, it has contributed heavily to the headline result for the year. The category with the third fastest growth in April, fashion, is now back amongst the weaker performers after two monthly contractions, and is slowest in year-on-year terms (+24.6%, yoy).
The three most populous states represent just over 80% of all online sales, slightly above their share of the population. Of these three states, Queensland recorded the strongest growth in the month, but was outpaced by WA and NT. Victoria retains the lead over the year. This month we have included data by state and category to provide additional insights. The strong result for Queensland in the month was driven by grocery and liquor, and homeware and appliance sales, with WA growth more broadly spread across categories. NT was the only region to record growth in fashion in the month, and saw strong growth in personal and recreational gear.
Both metro and regional areas grew in the month. In year-on-year terms, Vic metro leads overall, while regional growth is led by NSW, followed by Vic and Tas.
In terms of merchant location, sales at international merchants saw slight contraction in the month while domestic merchants returned to mild growth. Domestic merchants have significantly outpaced international over the year.
For further details, please see the NAB Online Retail Sales Index June 2020.
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