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Australian retail sales falls 0.4% in March

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2024-04-30

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Australian retail sales growth vanished when Taylor Swift flew out of Australia at the end of her seven-concert, two-week tour in February. March data from the Australian Bureau of Statistics on Tuesday showed retail turnover fell 0.4% in March after a 0.2% rise in February and a 1% jump in January (which followed a slide the previous December, despite it being Christmas).

The Taylor Swift effect dissipated for footwear and clothing outlets, as well as for department stores, especially those in Sydney and Melbourne where Ms. Swift held her concerts.

Ben Dorber, head of retail statistics at the ABS, said: “Consumers pulled back on retail spending in March as the cost of living pressures remained high."

“Underlying retail turnover has been flat for the past six months and was up only 0.8% compared to March 2023. Outside of the pandemic period and introduction of the GST, this is the weakest growth on record when comparing turnover to the same time in the previous year.”

“The Taylor Swift-inspired boost in turnover for fashion and accessory retailers last month has proved to be temporary with an instant reversal this month,” Mr. Dorber said.

The largest falls were recorded in clothing, footwear, and personal accessory retailing (down 4.3%) and department stores (-1.6%). Both industries recorded large rises in February attributed to the Taylor Swift effect, but those gains were mostly cancelled out by these falls.

(There was no sign of a slowdown in the supermarket sales of Coles in its quarterly report yesterday - supermarket sales rose 5.1%, but liquor sales did show an impact with sales down 1.9%).

Falls were also seen in household goods retailing (-1.4%), other retailing (-0.3%), while there was a 0.2% drop in sales at cafes, restaurants, and takeaway food services.

“Retailers told us that overall trading conditions remain challenging with consumers being cautious in their discretionary spending.

“Consumers continue to experience cost of living pressures with price rises in education, healthcare, housing, and insurance,” Mr. Dorber said.

Retail turnover growth was mixed across the country. New South Wales (-1.1%) and Victoria (-0.8%) recorded the largest falls and drove the overall fall this month after recording large rises in February.

“The falls in New South Wales and Victoria are larger than the rises last month when both states benefited from increased spending associated with the Taylor Swift concerts,” Mr. Dorber said.

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