NZ: Electronic card spending down in July – Westpac

Satish Ranchhod, Senior Economist at Westpac, notes that New Zealand’s overall electronic card spending was down in July, weighted down by a fall in fuel prices.

Key Quotes

“Excluding fuel and vehicle spending, core spending levels edged up in July, holding on to their solid gain from last month.”

“July saw a sharp pull back in retail spending, with spending levels down 0.5% over the month. However, the result was strongly influenced by sharp falls in petrol prices, with fuel spending down 6%.”

“Looking through the volatility associated with fuel prices, spending on core categories was up 0.1%. Although that’s a very muted increase, it comes on the back of a solid gain last month that has been sustained in July. Notably, after rising strongly in June, hospitality spending only edged back a little, with the strong tourist season still supporting activity in areas like accommodation and dining out. July also saw modest gains in spending in other core categories.”

“Annual growth in spending has slowed sharply over the past year. Spending levels are only up 2% over the past year.”

“We continue to expect moderate, rather than spectacular, spending growth over the coming months. While interest rates are still low, they have been pushing upwards. In addition, the slowdown in the housing market will dampen spending in a number of areas.”