A jump in car sales has driven a pick-up in household spending, but people remain cautious about opening their wallets and purses too widely.
Figures from Statistics New Zealand show retail sales rose a seasonally-adjusted 0.4% to $5.5 billion in May compared to the previous month.
Excluding spending on cars and fuel, core sales fell 0.2%, led by a decline in spending in cafes, restaurants and accommodation, which offset higher purchases of appliances.
Deutsche Bank chief economist Darren Gibbs says most people are reluctant to spend up large despite signs of an improving employment market.
Actual sales fell by 0.6% and Statistics NZ says it's only the fourth decline since the series began in 1995.
The agency says the trend shows core sales have fallen 0.7% since October last year.
