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ANZ analysts note that the Australia’s retail sales grew 0.4% m/m in June, in line with their expectations and slightly stronger than the market’s expectations, which brought quarterly sales growth to 0.6% in nominal terms.

Key Quotes

“Nominal q/q results in retail have hovered between 0.6% and 0.7% for the last four quarters.”

“Volume growth was modest at 0.2% q/q – the fourth very weak quarter in a row. Another jump in food prices, reflecting dry conditions across key agricultural regions in Australia, was a key reason for the divergence between nominal and real growth rates. Annual volume growth was 0.2% y/y, the lowest result since 1991, when Australia was last in recession. To emphasise how weak, per capita retail sales were sharply negative.”

“Retail volumes decreased in annual terms in NSW, Tas, WA and the NT, while Vic and Qld were the only states to see noteworthy volume growth (1.4% y/y and 2.7% y/y respectively).”