Australian retail turnover fell 0.2% in October, according to the latest Australian Bureau of Statistics (ABS) figures, the first monthly fall for the sector following rises in August and September.
ABS head of retail statistics, Ben Dorber said the falls suggest increased cost of living pressures, including interest rate rises, have started to weigh on consumer spending.
“Turnover fell in all industries in October except for food retailing, which rose 0.4% boosted by flood-related spending in parts of Australia and continued high food prices,” he said.
For the second consecutive month department stores felt the largest decline, falling 2.4%, followed by clothing, footwear and personal accessory retailing, down 0.6%. Household goods retailing also retreated for the second consecutive month, down 0.5%, the fifth fall in the last seven months.
Commenting on the results, National Retail Association interim CEO Lindsay Carroll said the fall in turnover was imminent as the economy caught up with increasing costs. “We are finally starting to see the cost of goods and services out-perform the demand.”
“Consumers are adjusting their budgets to be able to spend over the holiday season and carry them through the start of 2023, when we expect rate rises to have an even greater impact. Inflation is here to stay, particularly with the prospect of increased wages from the IR Bill set to pass this week. It is time for the RBA shift gears and address the supply-side challenges that are exacerbating costs,” she said.
Turnover was felt across the country with falls recorded in most states and territories. The Northern Territory had the largest fall, down 1.8%, followed by Tasmania-1.7%, the Australian Capital Territory 1.4%, Queensland 0.4% and New Souths Wales and Victoria by 0.1%.
While Queensland and New South Wales had small percentage falls, these states recorded the largest falls in dollar terms, while turnover in South Australia and Western Australia was relatively unchanged.