Daily Commentary BY THE CURVE TEAM –

Retail Sales Surge

23rd of December, 2020

Preliminary estimates for retail sales in November show a large lift in sales, with one primary cause.

Sales were up 7% for the month leaving them 13.2% higher than last year. It continues a remarkable run for retail sales and indicates higher household incomes is translating to spending.

Service spending will continue to lag while movement around the country and globe is restricted. Black Friday contributed to the gains, but the predominant driver of the high numbers was Victoria re opening.

Victorian sales were up a remarkable 21% for the month, whereas the rest of the country was up 2.7%. It makes the NSW recent case numbers all the more frustrating, as recent restrictions will inevitably impact spending.

Nine new cases were announced yesterday following the fifteen from the day before. Imminently, these numbers appear positive, however concerns remain beyond the Christmas and New Year period.

In the middle of the year, NSW had a similar number of cases that was eventually quashed. The difference now is the increased number of gatherings and movement around the country that the Christmas time brings.

Josh Stewart

Associate - Money Markets