Growth in retail sales continues to slow down in Australia
The Australian retail sector is expected to see a further slowing in growth nationally with the AFGC CHEP Retail Index showing growth of 4 per cent year-on-year in the March quarter, slowing to 3 per cent by the June quarter.
Within this broader trend, on a monthly basis the Index predicts Retail Trade Turnover for the month of March to be $24 billion, representing a year-on-year growth of 4.2 per cent for that month. This slightly higher than expected growth for the month was likely due to the Reserve Bank’s February interest rate cut and earlier falls in petrol prices, which helped to support the stronger levels of consumer sentiment in the first few months of 2015.
However, the downward trend remains, coming into May, with turnover to soften to $23.9 billion and year-on-year growth to slow to 3.1 per cent for May 2015.
The AFGC CHEP Retail Index is a collaborative project between the AFGC and CHEP Australia, powered by Deloitte. The Index uses CHEP transactional data based on pallet movements and is a lead indicator of ABS Retail Trade data.
“The growth in food retailing has eased a little in recent months, and is now slightly below the growth rate for total retail sales,” said Dr Geoffrey Annison, AFGC Deputy Chief Executive. “As the Australian economy continues to unwind from the mining boom, a stronger labour market will be needed for strength in retail sales growth to be sustained,” he said.
CHEP Asia-Pacific President, Phillip Austin, said, these trends indicated why there has been “considerable activity across all the retailers as they reconfigure their supply chains to optimise for available growth”.
The next AFGC CHEP Retail Index will be released in late July 2015.