Food retail continues growth trend
The rate of trend growth for food retailing increased again in the December quarter, the Australian Bureau of Statistics advised today. It represented the third straight quarter of the trend growth rate rising, with a 1.8% increase for the food retail sector. However, the ABS noted that the rate of growth was more greatly influenced by price hikes than by volume increases.
Restaurants, cafes and restaurants saw a 0.6% decline in trend growth, the fourth straight decline for the sector as consumers cut back on discretionary spending.
Retail industry body, the Australian Retailers Association (ARA), said the 0.7 per cent increase in the December 2008 quarter’s retail turnover was positive news for retailers who have reserved confidence of improved consumer sentiment.
“There was a lot happening in the retail sector during the December 08 quarter. Retailers were relying on heavy discounting to move stock; petrol prices began to spiral downwards; and the Rudd Government’s first economic stimulus package landed in bank accounts in December,” ARA Executive Director Richard Evans noted. “All of these positive economic conditions had an effect on consumer spend and returned consumer confidence during the past quarter. Consumers have defied negative rhetoric and panic commentary surrounding the global financial crisis and responsibly injected funds into the economy.”
“The sector feeling most of the benefit was food retailing (1.8.%), followed by other retailing (1.3%) and department stores (0.3%). Clothing and soft good retailing was up by (-0.2%) and household goods (-0.7%) benefited from significant post-Christmas sales outside of the survey period,” Mr Evans added. “The March quarter is always the toughest for retailers as credit card bills from Christmas roll in and back to school costs reign in consumer discretionary spend, but retailers are hopeful improved growth will return to the sector by the September quarter.”
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