Australia: Retail sales weaken - Westpac

Matthew Hassan, analyst at Westpac, points out that Australian retailers recorded a weak finish to 2018, monthly sales dipping 0.4% in December month and real retail sales up just 0.1% for Q4 as a whole.

Key Quotes

“The results underscore weakness already apparent in the Q3 national accounts and point to disappointing momentum heading into 2019.”

“The 0.4% dip in monthly sales was against market expectations of a flat finish. Some of this likely reflects ‘residual seasonality’ – i.e. seasonal patterns that the ABS is struggling to adjust for.”

“The quarterly wash up underscores the weak theme. Real retail sales rose just 0.1% in Q4, well below the consensus estimate of a 0.5% gain but closer to Westpac’s 0.2% call. The detail showed nominal sales up 0.7% but retail prices up 0.6% – firmer than in Q3 with non food retail prices showing a notable stabilisation over 2018.”