Commentary Directory

Australia Retail Sales: August 2023

Jacob Hess
September 27, 2023

Australia Retail Sales

9/27/2023 (August 2023)

+0.2% MoM (+1.5% YoY)

Below Expectations

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Food -0.3% MoM
Household Goods -0.4% MoM
Clothing +1.3% MoM
Restaurants +0.7% MoM

Australian retail turnover increased by 0.2% in August, following a 0.5% rise in July and a -0.8% decrease in June. This modest growth in August reflects a continued restraint in consumer retail spending. Year-over-year, retail turnover grew by only 1.3% compared to August 2022, marking the smallest 12-month trend growth in the series' history. This low growth rate underscores the impact of cost-of-living pressures on consumer behavior, despite inflation and population growth. Among retail categories, clothing, footwear, and personal accessory retailing saw the most significant rise at 1.3%, boosted by warmer weather, promotional activities, and the 2023 FIFA Women’s World Cup. In contrast, household goods and food retailing experienced declines. Retail turnover results varied across states and territories.

From ABS

Australia’s retail sales gains benefited slightly from the 2023 Women’s World Cup, so excluding that, consumers did not spend much at all in August. In fact, because the tournament spanned July as well, it’s likely that some of the gain in that money was also attributed to the World Cup. The reality is that Australian consumers are starting to retract on their spending amidst higher interest rates and a worsening financial situation. The only thing propping up consumption right now is strong incomes, and once those start to diminish, sales will see significant declines.