(Bloomberg) -- Australian retail sales soared to a record high in the final three months of 2021, fueled by a combination of relaxed virus restrictions and holiday shopping that are set to underpin a robust rebound in the economy.
Sales surged 8.2% in the fourth quarter, recovering from a sharp drop in the prior period when the nation’s two most populous states were in lockdown to combat a virus outbreak, Australian Bureau of Statistics data showed Monday. The gain outpaced economists’ expectations of a 7.8% increase.
“Consumers enthusiastically returned to discretionary spending following the end of delta related lockdowns,” Ben James, director of Quarterly Economy Wide Statistics at the ABS, said in a statement.
“Well publicised concerns over product availability and delivery timeliness led to consumers bringing forward their end of year shopping, in conjunction with a re-opening spending splurge due to pent up consumer demand,” he said.
The result will boost policy makers’ confidence that the A$2.1 trillion ($1.5 trillion) economy is on track for a solid recovery from a pandemic-induced contraction in the third quarter. A surge in household spending is among reasons economists expect the Reserve Bank to raise interest rates in the second half of this year.
At the same time, trade data released last week showed a corresponding surge in imports in the final three months of 2021 -- also fueled by high household demand -- which is likely to take a cut out of GDP growth in the period.
The early part of this year is also likely to prove challenging for retailers as a surge in new cases of the omicron variant of coronavirus is prompting caution among consumers. This was reflected in a separate survey of job advertisements, showing a 0.3% fall in January
Today’s retail report showed:
- Clothing, footwear and personal accessories led gains, soaring 43.1%
- Cafes, restaurants and takeaway food services jumped 18.8%
- Food retailing -- down 1.6% -- was the only industry to fall
- Sales volumes are now at their highest quarterly level of the series
(Updates with further details from report)
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