15 Nov 2010

Pre-GST rush boosts retail spending

2:39 pm on 15 November 2010

Shoppers wanting to beat the GST rise boosted retail spending in the three months to September.

Retail sales rose a seasonally adjusted 0.8% to $16.8 billion in the quarter, Statistics New Zealand figures show.

Excluding fuel and car sales, core retail sales were 0.9% higher for the quarter, and core volumes - which exclude price rises - rose by the same amount.

Sales picked up sharply in the September month, rising a seasonally adjusted 1.6% compared with August.

UBS senior economist Robin Clements says most of the rise is due to purchases made in anticipation of the GST rise.

Mr Clements says consumer spending remains relatively weak once the pre-GST spend-up is taken into account.

All regions showed strong growth in September, except for quake-hit Canterbury, where sales picked up by only 0.1%.

Spending on furniture and floor coverings shot up 31% in September, and on appliances 14%.

Electronic card transactions, which account for 60% of all retail spending, rose a strong 0.9% in October, indicating yet-to-be-released spending numbers for the month should post another healthy rise.