Daily Commentary BY THE CURVE TEAM –

Data Anomalies Cloud the Outlook

23rd of April, 2020

Preliminary data for retail showed another quirk of the Covid-19 Shutdown, with a record rise posted.

Over the last few weeks the ABS has announced several new data series offering preliminary and more frequent updates to key metrics. Aimed at preparing the market and smoothing the impacts of the likely large downtrend in key categories like sales and employment, the preliminary data will likely show a few intra-month seasonal type anomalies we wouldn’t usually see.

Ask anyone who has attended a shopping centre and they would tell you almost all stores except the majors supermarkets and grocers are either closed or empty. Despite this, preliminary retail sales data out yesterday showed a record rise in consumer sales. The scenes we would have all seen in early to mid March with supermarket isles stripped of everything a person would usually put in the trolley on the weekly or fortnightly shop are the cause of this. Total food sales were up 24% with toilet paper sales doubling.

As the heat of the grocery hoarding dies down it is very likely this rise be very quickly unwound with even grocery item sales falling as those who hoarded items realised they have no use for their now surplus items. This drastic and temporary uptick would usually be hidden by a longer survey period. Similar to the market dislocations in oil and air travel we have seen recently the unknown is not if these anomalies will occur again but just where and how they will manifest in the data.

Matthew Dunshea

Client Relationship Manager