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Westpac On NZ Retail Sales Drop

NEW ZEALAND

The local bank notes real spending and per capita trends have been quite weak under the weight of higher rates and inflation, see below for more details:


Westpac: "Today’s report highlights the significant impact that price increases and higher borrowing costs are having on spending appetites. Nominal spending levels were down 0.4% over the past year. But with strong price growth, the amount of goods that households are actually taking home has dropped 4% over the past year. And it’s been falling for two years now as strong financial pressures have squeezed households’ spending power.


Notably, those declines have come at the same time as population growth has been surging. In per capita terms, the volume of goods that households are taking home has fallen 6.7% over the past year.

With interest rates at high levels and inflation still strong, we expect continued weakness in spending over 2024.


Today’s result was weaker than expected. We’re currently forecasting a modest 0.1% rise in December quarter GDP. We’ll review that number over the coming weeks as more data comes to hand."

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