Australian retail sales rose 4.8% in September 2026 year-on-year. Spending finally slipped to below trend growth, albeit the weakness is centred on household goods, department stores and surprisingly at-home food & liquor. Café, restaurant and takeaway food spend was up 7.8% and broader discretionary spending was very strong. This downturn is housing centric thus far and a broad-based slowdown is more likely by the June 2027 quarter as negative wealth effects show through.

What we’re hearing and seeing in retail

• Sales trends worst in housing categories: Our feedback on October sales is worse than September. Housing categories have responded fastest to the combination of interest rate hikes and the drop in housing churn. Listed furniture retailers have reported declining sales in the September 2026 qtr.
• Black Friday ramping: Black November sales in furniture have started, in-line with 2025 timing. Outside of furniture, last year saw promotions starting around 12 November. Black Friday has been orderly so far.
• David Jones administration: David Jones has 500,000sqm of floor space and could be in administration within a week. This could trigger near-term discounting across apparel, footwear, homewares and small appliances.

Sub-sector insights

• At-home food and liquor: At-home food & liquor sales grew 3.2%, slowing from 4.1% in August. Woolworths comparables sales for 1Q27 of 6.1% was ahead of Coles at 2.7%. The success of the Disney Ooshies promotion supported Woolworths. Endeavour Retail 1Q27 sales were up 3.0% which implied 1.4% in the seven weeks to the end of September 2026.
• Cafes, restaurants and takeaway food: At the category level spending accelerated from 6.2% in August to 7.8% in September. Guzman Y Gomez comp sales for 1Q27 were up 7.1%.
• Household goods: Household goods grew 3.5% in September slowing from 5.9% in August 2026. Bunnings slowed by close to 2pp in its mid-Aug to mid Oct update. JB Hi-Fi had consistent sales trends in August and September at 1.4%. Temple & Webster sales fell 4% for the period mid-Aug to mid-Oct. Nick Scali sales were down 15% for 1Q27.
• Dept & Discount dept stores: Dept store category sales grew to 1.1%. Kmart sales in 1Q27 were “broadly in line with 2H26” implying growth of 2.3%. Big W sales fell 1.0% in the September 2026 quarter.
• Clothing & footwear: Clothing & footwear rose 4.7%. Universal Store comparable sales rose 2.7% for the 10 weeks to October. Perfect Stranger sales rose 7.4% during this period, slowing from 17.6% in July and August.
• Other retailing incl pharmacy and recreational goods: At the category level sales rose 7.9%. BCF comparable sales slowed to -2.9% over six weeks to October, citing rising fuel prices while Rebel slowed to -0.6%.
• Online spending: AusPost reported online sales growth for the September 2026 quarter of 17%, up from 14% in the June quarter. Recreational goods, food & liquor and marketplaces grew fastest online at greater than 20%.
• Consumer spending: Both discretionary and non-discretionary grew above long-term averages at 6.1% and 6.2% respectively. Elevated fuel costs drove transport spending up 10.0% in September.