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HomeNEWS‘Unprecedented fall’ in retail sales in June quarter

‘Unprecedented fall’ in retail sales in June quarter

Retail sales slumped over the past three months as the Covid-19 pandemic hit spending.

Official figures show retail sales volumes, which leave out price movements, fell a seasonally adjusted 14.6 percent for the three months ended June on the previous quarter.

“This unprecedented fall in the June quarter was not unexpected, with Covid-19 restrictions significantly limiting retail activity,” Stats NZ retail statistics manager Kathy Hicks said.

“Non-essential businesses closed temporarily for about half of the quarter during alert levels 4 and 3.”

The biggest falls were in eating out and accommodation, which were close to 40 percent down on the previous quarter, and fuel sales, which fell 24 percent. All of which were significantly disrupted by the lockdowns.

Grocery sales were fractionally lower, but there was an 11 percent lift in online sales.

The value of sales during the quarter was about $20 billion, close to $4bn down on the previous quarter and the same period last year.

An economist said the fall in retail sales was not as bad as most had been expecting, but there was also reason to doubt whether the rebound would be as strong.

“While spending levels did pick up as the Alert Level was rolled back, it has been dealt another blow by the recent flare up in cases,” Westpac senior economist Satish Ranchhod said.

“In addition, spending will continue to be challenged by the ongoing lack of international tourists and the eventual wind down of the wage subsidy scheme.”

Consumer spending and service industries make up a large part of the economy, and Ranchhod said Westpac’s preliminary view is that the economy will have shrunk by about 13 percent during the March-June quarter on the previous three months.

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