Aussie Retail Sales Power Along in November

Australian retail sales continue to power along increasing a seasonally adjusted 0.8% in November. From the ABS:

SEASONALLY ADJUSTED ESTIMATES

• The seasonally adjusted estimate of turnover for the Australian Retail and Hospitality/Services series increased by 0.8% in November 2007. This follows a revised increase of 0.3% in October 2007 and an increase of 0.7% in September 2007.
• All states and territories had increases in the seasonally adjusted estimate, except the Australian Capital Territory (-0.3%). The largest increases occurred in Western Australia (+1.9%), the Northern Territory (+1.6%) and New South Wales (+0.8%).

ORIGINAL ESTIMATES

• In original terms, Australian turnover increased by 3.9% in November 2007 compared with October 2007. Chains and other large retailers (which are completely enumerated) increased by 5.2%, while the estimate for 'smaller' retailers (the sampled units) increased by 2.2%.
• Australian turnover increased by 8.4% in November 2007 compared with November 2006. Chains and other large retailers increased by 10.3%, while 'smaller' retailers increased by 5.8%.

A strong labour market and robust economy continues to underpin strength in retail sales. However recent interest rate rises, the threat of more to come in February and recent action by 3 of the big 4 banks to increase mortgage rates casts doubts over the ability of Australian consumers to keep up the pace of spending.

In the chart above the 6 month moving average of month on month changes in retail sales looks to be peaking however a significant slowdown in the economy and a sharp rise in unemployment would be needed to see that move down significantly.