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Retail sales hit fastest rise in a decade

NZ NewswireNZ Newswire 12/08/2016 Tina Morrison

New Zealand second-quarter retail sales volumes rose at the fastest pace in close to a decade, beating economist expectations.

The volume of retail sales increased a seasonally adjusted 2.3 per cent in the three months through June from the March quarter, the biggest percentage increase since the December 2006 quarter, Statistics New Zealand said.

That's ahead of the 0.9 per cent forecast in a Reuters poll of economists. Retail sales volumes for the March quarter were revised up to 1 per cent from 0.8 per cent. Core retail volumes, which excludes the more volatile vehicle-related industries, increased 2.6 per cent in the June quarter, the agency said.

The country's retail sector posted gains across 12 of the 15 industries. Retail spending has picked up the pace as the country's population grew at its fastest ever pace in the year through June, tourism is at an all-time high, and as record low interest rates and an elevated currency stoke demand.

The hardware, building and garden supplies industry had the largest volume and value sales increase in the latest quarter.

"Consumer spending is humming along, with DIY and trade staff customers boosting sales in the hardware and building supply trades," Statistics NZ business indicators senior manager Neil Kelly said, noting that demand was particularly strong in the Auckland region.

Volumes of hardware, building and garden supplies rose 5 per cent, motor-vehicle and parts retailing gained 2.6 per cent, pharmaceutical and other store-based retailing increased 5.2 per cent and food and beverage services advanced 3.3 per cent, the agency said.

The biggest declines were in fuel retailing, which slipped 1 per cent, and recreational goods, which dropped 3.3 per cent.

On an annual basis, the quarterly value of actual retail sales rose 5.5 per cent to $19.9 billion, while the volume rose 6 per cent, the data showed.

Retailers' inventories were 4.6 per cent higher at $7.2 billion at June 30 compared with the year earlier, with core retail stocks up 5.1 per cent, the agency said.

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