The latest household spending indicator (replaces Retail Sales series) showed retail sales growth of 4.8% for July 2025, up from 3.8% in June 2025. The strongest growth was in “other” retailing, which includes online pure-play, pharmacy and recreational goods. Department stores had a surprisingly strong result and household goods was solid too. We expect growth rates to hover close to 4% over the remainder of 2025.

Australian retail sales finished fiscal 2025 with 4.6% growth for June 2025, the strongest growth in over two years. The standouts were online, recreational goods, pharmacy, cosmetics and electronics. Liquor, cafes & restaurants and supermarkets were all laggards. The strong finish to the year partly reflects end of financial year sales. Retail spending for FY25e was up 3.3% and we see 3.9% growth for FY26e.

Australian retail sales rose 4.1% in May 2025 year-on-year. This is an acceleration on the combined March-April growth of 3.6%. Foot traffic data for May reported growth of 8%. Pharmacy, beauty, recreational goods and online were strongest in May. Weaker categories were liquor, cafes & restaurants and furniture, albeit all were positive in the period.

The National Accounts results make for stimulating reading for consumer-facing businesses because household income growth has accelerated at the same time as cost of living pressures have eased. Financial conditions are good. The March 2025 quarter showed household income growth of 6.7% with consumer spending rising 4.2%. Households are now saving 5.2% of their income. The dilemma in our mind is whether conditions accelerate from here. We expect the rate of retail sales growth, currently trending at 4%, to persist over the next 12 months. While interest rate cuts will help, a slowdown in population and lapping the income tax cuts means income growth is actually likely to slow a little, making it hard to see an acceleration in retail sales growth.

Australian retail sales rose 4.0% in April 2025 year-on-year. The March-April period has been distorted by the shift of timing of Easter over the past two years. Therefore, the combined March-April results are more relevant and show retail sales growth of 3.6%. The strongest areas are online, pharmacy, beauty and recreational goods. The weakest areas remain liquor, cafes & restaurants and department stores.

Australian retail sales grew 3.2% in March 2025 year-on-year. March was impacted by the timing of Easter. Last year Easter Sunday fell on 31 March but was on 20 April in 2025. Impacts are varied by category depending on product and store closure effects. On an underlying basis, March growth looks strong for supermarket, department stores and recreational goods. Queensland sales were dragged down by Cyclone Alfred.

Most retailers have highlighted how much tougher their NZ operations have been over the past year. The magnitude of the interest rate pain combined with lower levels of household savings has created a much tougher backdrop. However, conditions are improving and rate cuts have been significant with more to come. NZ retail sales should recover over 2025, more so in the second-half. We have pulled together a chart pack that provides a perspective on the NZ economic outlook, retail sales forecasts and financial performance of major retailers in that market. We include both ASX-listed retailers and NZ-centric retailers.

Australian national accounts for the December 2024 quarter paint a clear picture on the drivers of a noticeable improvement in retail spending over that time period. Household income rose 5.6% with wages growth of 6.1%. Retail spending was up 4.0%. It appears close to half the tax cuts have been spent and non-retail spending is no longer crowding out spend. From here, sales growth should improve modestly as retail captures its fair share of the wallet. A slowdown in population growth of circa 0.5% needs to be taken into consideration as a partial offset and, along with low prevailing savings rate, informs our view that the retail upswing will be modest over the next 12 months.

Australian retail sales rose 4.1% in January 2025 with decent signs of growth across most categories. Liquor is still lagging, while hardware and electronics were softer than recent months. Pharmacy and recreational goods were the standout segments. We expect retail category and company divergence to rise over the next six months. Overall sales trends are likely to bounce around the 3%-4% mark, which is satisfactory growth, but still a challenge relative to cost growth.

Australian retail sales rose 4.0% in December 2024, with some notable outliers across segments. Electronics was up 11%, furniture up 8% and pharmacy up 7%. On the other hand, department stores, supermarkets, liquor and recreational goods were all very soft. Some of the shifts reflect the baseline with December compound annual growth rates actually slower than November for all categories other than hardware and liquor.