MNI ANALYSIS: Australia Dec Retail Sales Down But Q4 Improves

     SYDNEY (MNI) - Australia's retail sales fell more than expected in

December, partly reversing the sharp gain the month before but showing an

overall improvement in retail spending in the fourth quarter.

     The data would provide some comfort to the Reserve Bank of Australia and

raise optimism that continued improvement in the labor market may lead to a

better outlook for household consumption in coming quarters. 

     In volume terms, retail sales rose 0.9% q/q in Q4, an outcome that was

close to MNI survey median forecast and a big improvement over Q3's 0.1% rise.

     Data published by Australian Bureau of Statistics Tuesday showed retail

sales fell 0.5% m/m in December, marking the first fall in four months. Trend

retail sales was 0.2% m/m in each of the three months of Q2, and this was up

from 0.1% in September.

     All categories of retail sales fell in December with the exception of food

retailing which rose 0.7% after two months of subdued rise. Household retailing

fell 2.6% m/m, giving back nearly half of the strong 4.7% rise in November. 

     Over the quarter, however, household retailing was the best performer,

rising 3.4% q/q to mark the biggest rise since at least Q4 of 2015.

     Below is table for Retail trade data for December:

                                            December                    November

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

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

                                           adjusted)                   adjusted)

Retail Sales                                    -0.5     +1.3(revised from +1.2)

                                 -0.2 (range -0.6 to

MNI Median                                     +0.4)

Food Retailing                                  +0.7                        +0.1

Household Goods                                 -2.6                        +4.7

Clothing, Footwear etc                          -0.1                        +1.7

Department Stores                               -0.6                        -1.3

Other Retailing                                 -1.8                        +2.2

Cafes, Restaurants,

Takeaways                                       -0.1                        +0.4

     Below is table for Retail trade (volume) data for Q4:

                                                   Q4                         Q2

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

                                   (Q/Q %, seasonally         (Q/Q %, seasonally

                                            adjusted)                  adjusted)

Retail Sales (Volume)                            +0.9         +0.1 (no revision)

MNI Median                        +1.0 (+0.6 to +1.2)

Food Retailing                                   -1.2                       +0.9

Household Goods                                  +3.4                       -1.6

Clothing, Footwear etc                           +2.1                       +1.0

Department Stores                                +2.3                       -1.4

Other Retailing                                  -0.6                       +0.2

Cafes, Restaurants,

Takeaways                                        +1.6                       -0.6

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

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