MNI DATA PREVIEW: Australia Retail Sales Seen Edging Higher

By Lachlan Colquhoun

     SYDNEY (MNI) - Australia retail sales data will be published Tuesday,

giving the Reserve Bank of Australia a last minute look at the consumer before

their May interest rate decision.

     Here are five things of interest to look for in the release by the

Australian Bureau of Statistics.

Another surprise? 

Retail sales surprised the market and spiked by 0.8% in January, going against

expectations of another stagnant result. It was the biggest jump in sales since

November 2017, and came after an anaemic 0.1% increase in January and a 0.4%

fall in December. The market is not expecting a big surprise, with expectations

of a monthly gain of around 0.3%.

More focus on the RBA. 

The Board of the Reserve Bank of Australia meets tomorrow amid speculation of an

interest rate cut, the first move in official rates since November 2016. Even if

the RBA leaves rates unchanged, a weak retail sales number would confirm that a

rate cut is not far away and could come in the next few months.

Department stores bounce back. 

The department store sector has been under intense pressure from online

channels, but deep discounting has attracted consumers back and the sector

enjoyed a 3.5% spike in February. This followed a 2.2% fall in January and a

1.2% dip in December.

Online sales stall. 

February data showed that online retail sales fell by 9.1% in February. It was a

rare fall for a sales channel which has continued to strengthen, and now

accounts for 5.6% of all retail sales in Australia.

Household goods rebound 

Spending on household goods also surprised with a 1.1% rise in February. This

came after an unchanged result in January and a 2.9% fall in December. A revival

in this sector plays into the RBA's more positive outlook of 2018 under which a

rate cut is unnecessary, but the rebound may not be strong enough in 2019.

--MNI Sydney Bureau; +61 405322399; email: lachlan.colquhoun.ext@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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