Australian consumers are finding it difficult to confidently spend up in the face of weak wage growth and general lack of optimism. That’s the view of Westpac senior economist Matthew Hassan in light of retail sales figures for January.
Sales figures grew by 0.4% over the month or 3.1% for the 12 months to the end of January which was in line with market expectations. December’s comparable figures had been -0.1% and 3.0% but those figures had been met with a suspicion. The closure of Masters Home Improvement stores was thought to have led to discounting while stock was cleared, so a comparison of the two months may be a little tainted.
Mr Hassan said the results in various categories was “mixed” and overall he was bordering on negative in his response to the figures. “Other results were disappointing…Total retail sales excluding household goods was up just 0.2%…Notably, weak wage income growth and consumer caution is contributing to relatively modest spending outcomes.”