Australia Retail Sales Flat As H'Hold Goods Fall, Trend Slows

     SYDNEY (MNI) - Retail trade data for July published by the Australian

Bureau of Statistics on Friday:

                                                 July                       June

--------------------------------------------------------------------------------

                                   (M/M %, seasonally         (M/M %, seasonally

                                            adjusted)                  adjusted)

Retail Sales                                      0.0   +0.2 (revised from +0.3)

MNI Median                  +0.3 (range +0.1 to +0.5)

Food Retailing                                   +0.7                       -0.1

Household Goods                                  -1.7                       +0.7

Clothing, Footwear etc                           -0.2                       +0.8

Department Stores                                -2.8                       -0.5

Other Retailing                                  +1.3                       +0.2

Cafes, Restaurants,

Takeaways                                        +0.2                       +0.5

     FACTORS: Retail sales were flat in July, following three months of growth,

leading to a slowing in trend growth to +0.3% from +0.4% in June. The outcome

was mainly due to a 1.7% m/m fall household goods retailing and a slowing in

foods services, which were partly offset by a rise in foods retailing. The trend

for household goods has slowed to 0.4% rise in July after three months of 0.6%

increase. The trend for department stores was down for three months in a row

that followed an increase of 0.3% at the start of the year. 

     TAKEAWAY: The outcome was worse than expected and below the range predicted

by economists in an MNI survey. The data vindicates the Reserve Bank's worry

about household consumption and supports the case for monetary policy to remain

on hold for longer. In the September cash rate statement, the RBA highlighted

the concern once again when it said that slow growth in real wages and high

levels of household debt are likely to constrain future growth in spending.

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

[TOPICS: MTABLE,MALDA$,MALDS$,MMLRB$,M$A$$$,M$L$$$,MT$$$$]