9 Sep 2011

Electronic spending down

12:50 pm on 9 September 2011

Shoppers appear to be less willing to open their wallets.

Statistics New Zealand says that spending using electronic cards fell by 0.5 percentage points in August, the biggest monthly fall since December last year.

Radio New Zealand's economics correspondent says the figures are the first hard data on the economy since global markets went into a tailspin in mid-August.

A survey published earlier this week by BNZ shows consumers felt better about the coming year in August than in July.

But evidently that has not translated into higher spending as more consumers put away their plastic in August.

Spending using cards fell 0.5 percentage points during the month and was down 1% excluding spending on fuel and vehicles.

All sector groups experienced falls, with durables, which includes furniture, hardware and appliance retailing, showing the largest drop.

The data will be considered carefully by the Reserve Bank as it contemplates the next Official Cash Rate decision on Thursday.

Financial markets gave just a 16% chance of any increase in the OCR next week immediately after the data was issued on Friday.