Daily Commentary BY THE CURVE TEAM –

True Picture of Retail Trade Emerges

Data from the Australian Bureau of Statistics (ABS) out yesterday showed the true picture of the impact of the lockdown on retail trade. With the ABS increasing the frequency of data releases during this uncommon period, a more accurate picture of the real economy is starting to form.

After a large spike in March as consumers hoarded grocery and household staple items, data for April showed a collapse in sales. The fall in percentage terms was somewhat over stated coming off the March spike. As a baseline the fall itself is the largest in the history of the ABS data series, down 17.9% or $5,383.3m in dollar terms seasonally adjusted.

As many would have predicted the falls in sales were widespread but data from grocery store scanners showed non-perishable items down 23.7% with hoarders likely having excesses of those items with no need to purchase more. Similarly, cafes and restaurants saw significant falls with lockdown measures forcing widespread closures.

The hope for this data series is that whilst May will likely also show a soft reading, we will be coming off the lower April level in percentage terms so the decline will not be as dramatic. Further out, as lockdown measures ease, sales would be expected to pick up but that would likely not be reflected in the data until June. Anecdotally, many would have noticed increases in foot traffic over the last week at shopping centres but the question remains that whilst people are starting to get out of the house will they begin to reopen their wallets.

Matthew Dunshea

Client Relationship Manager