WELLINGTON, Feb 14 (Reuters) - New Zealand retail sales fell
slightly less than expected in the December quarter, reflecting
cautious households amid a fragile recovery and high
unemployment, backing views that interest rates will stay on
hold well into the second half of the year.
Seasonally adjusted retail sales volumes, which strip out price changes, fell 0.4 percent in the three months to Dec. 31 compared with a Reuters poll forecast of a 0.6 percent decrease.
***************************************************************
KEY POINTS:
- Q4 volumes driven by falls in furniture, hardware spending, offset by rises in petrol and supermarket sales.
- Dec month s/adj sales -1.1 percent on hardware, building supplies, supermarket stores. (Reuters poll -0.2 pct).
- Dec month ex-auto sales -1.2 pct (Poll -0.4 pct).
- First release under the Australian and New Zealand Standard industrial Classification 2006. From this quarter's release, volumes are expressed in Sept 2010 quarter prices.
- Click on for full table
COMMENTARY:
MARK SMITH, ECONOMIST, ANZ-NATIONAL BANK
'It confirms it was not a good Christmas shopping season, but in terms of Q4 gross domestic product, it's potentially not as bad as some had feared, with core volumes unchanged, which is probably a positive and it's likely to downplay fears that New Zealand was in recession for the second half of last year.'
'For the Reserve Bank of NZ it's very much consistent with their theme of rates on hold till we see signs of a more sustained pick up.'
NICK TUFFLEY, CHIEF ECONOMIST, ASB BANK
'It was in keeping with a pretty lacklustre finish to the year. The message is that with pretty weak consumer spending, the Reserve Bank is not going to be in a hurry to raise rates.'
PHILIP BORKIN, ECONOMIST, GOLDMAN SACHS
'It confirms the Christmas shopping period was a tough one for retailers.'
'For the quarter it's not a surprise that volumes contracted, although the contraction was less than we had factored in, so that signals that firms didn't pass on all of the GST hikes.'
'In terms of our monetary policy view, we're unchanged, the data is a little old now and the electronic card numbers for January were a little bit better. We're still happy with a September rate rise.'
ROBIN CLEMENTS, SENIOR ECONOMIST, UBS
'The headline number for total activity in the quarter was slightly better than expected, but the market has taken it negatively because it's confirmed the fact activity was down.'
'That keeps the risk of a negative quarter for GDP on the table, and the risk of a second half recession.'
MARKET REACTION:
- The New Zealand dollar fell to $0.7565 from around$0.7580 before the data. Interest rate futures were largely unmoved, but longer dated contracts rose as investors pushed out further the timetable for rate rises.
LINKS:
- The Statistics New Zealand Web site is: www.statistics.govt.nz
- For all New Zealand news and data, 3000 Xtra users can click on
BACKGROUND:
- Monthly New Zealand retail sales data releases are being replaced by electronic card transactions data from next month, Statistics NZ has said. However, quarterly retail sales data -- volumes and values -- will continue to be produced.
- NZ electronic retail card sales fell 0.9 percent in December, but bounced back in January, posting the sharpest rise in five years on higher spending on furniture, appliances and also food and fuel.
- NZ's jobless rate rose to 6.8 pct in the December quarter from 6.4 pct in the September quarter as more jobs were shed.
- The Reserve Bank of New Zealand last month held interest rates at 3.0 percent, and said rates will remain low until the recovery gains momentum, which analysts increasingly believe will be July at the earliest.
- Financial markets have priced in virtually no chance of a rate rise on March 10, with the next rate increase expected in September this year.
- Credit card billings fell 1.4 percent in December, while new car registrations fell 22 percent in December from the previous month but up 14.5 percent from a year earlier.
- NZ's house prices showed signs of steadying in January, after falling in December.
- NZ sporting goods and homewares retailer Briscoe Group said on Feb 3 said fourth quarter sales were slightly higher than a year earlier, but the biggest listed retailer The Warehouse in January said sales over the important Christmas period had been weak.
(Reporting by Mantik Kusjanto) Keywords: NEWZEALAND ECONOMY/RETAIL (Mantik.Kusjanto@thomsonreuters.com)(+64 4 471 4234)(Reuters Messaging: mantik.kusjanto.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Seasonally adjusted retail sales volumes, which strip out price changes, fell 0.4 percent in the three months to Dec. 31 compared with a Reuters poll forecast of a 0.6 percent decrease.
***************************************************************
KEY POINTS:
- Q4 volumes driven by falls in furniture, hardware spending, offset by rises in petrol and supermarket sales.
- Dec month s/adj sales -1.1 percent on hardware, building supplies, supermarket stores. (Reuters poll -0.2 pct).
- Dec month ex-auto sales -1.2 pct (Poll -0.4 pct).
- First release under the Australian and New Zealand Standard industrial Classification 2006. From this quarter's release, volumes are expressed in Sept 2010 quarter prices.
- Click on for full table
COMMENTARY:
MARK SMITH, ECONOMIST, ANZ-NATIONAL BANK
'It confirms it was not a good Christmas shopping season, but in terms of Q4 gross domestic product, it's potentially not as bad as some had feared, with core volumes unchanged, which is probably a positive and it's likely to downplay fears that New Zealand was in recession for the second half of last year.'
'For the Reserve Bank of NZ it's very much consistent with their theme of rates on hold till we see signs of a more sustained pick up.'
NICK TUFFLEY, CHIEF ECONOMIST, ASB BANK
'It was in keeping with a pretty lacklustre finish to the year. The message is that with pretty weak consumer spending, the Reserve Bank is not going to be in a hurry to raise rates.'
PHILIP BORKIN, ECONOMIST, GOLDMAN SACHS
'It confirms the Christmas shopping period was a tough one for retailers.'
'For the quarter it's not a surprise that volumes contracted, although the contraction was less than we had factored in, so that signals that firms didn't pass on all of the GST hikes.'
'In terms of our monetary policy view, we're unchanged, the data is a little old now and the electronic card numbers for January were a little bit better. We're still happy with a September rate rise.'
ROBIN CLEMENTS, SENIOR ECONOMIST, UBS
'The headline number for total activity in the quarter was slightly better than expected, but the market has taken it negatively because it's confirmed the fact activity was down.'
'That keeps the risk of a negative quarter for GDP on the table, and the risk of a second half recession.'
MARKET REACTION:
- The New Zealand dollar fell to $0.7565 from around$0.7580 before the data. Interest rate futures were largely unmoved, but longer dated contracts rose as investors pushed out further the timetable for rate rises.
LINKS:
- The Statistics New Zealand Web site is: www.statistics.govt.nz
- For all New Zealand news and data, 3000 Xtra users can click on
BACKGROUND:
- Monthly New Zealand retail sales data releases are being replaced by electronic card transactions data from next month, Statistics NZ has said. However, quarterly retail sales data -- volumes and values -- will continue to be produced.
- NZ electronic retail card sales fell 0.9 percent in December, but bounced back in January, posting the sharpest rise in five years on higher spending on furniture, appliances and also food and fuel.
- NZ's jobless rate rose to 6.8 pct in the December quarter from 6.4 pct in the September quarter as more jobs were shed.
- The Reserve Bank of New Zealand last month held interest rates at 3.0 percent, and said rates will remain low until the recovery gains momentum, which analysts increasingly believe will be July at the earliest.
- Financial markets have priced in virtually no chance of a rate rise on March 10, with the next rate increase expected in September this year.
- Credit card billings fell 1.4 percent in December, while new car registrations fell 22 percent in December from the previous month but up 14.5 percent from a year earlier.
- NZ's house prices showed signs of steadying in January, after falling in December.
- NZ sporting goods and homewares retailer Briscoe Group said on Feb 3 said fourth quarter sales were slightly higher than a year earlier, but the biggest listed retailer The Warehouse in January said sales over the important Christmas period had been weak.
(Reporting by Mantik Kusjanto) Keywords: NEWZEALAND ECONOMY/RETAIL (Mantik.Kusjanto@thomsonreuters.com)(+64 4 471 4234)(Reuters Messaging: mantik.kusjanto.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.