Monday 13 February 2017 11:18 AM
NZ plastic card spending jumps in January as credit appetite increases
By Paul McBeth
Feb. 13 (BusinessDesk) - New Zealanders ramped up spending on plastic cards in January after a more subdued end to 2016
and continued to lean more heavily on their credit cards.
Retail spending rose a seasonally adjusted 2.7 percent in January after two months of zero movement, the biggest monthly
gain since December 2006, with increases across all six industries, Statistics New Zealand said. Stripping out
vehicle-related spending, core retail sales rose 2.5 percent in the month led by a 3.1 percent increase in durable
items.
"The lift in retail card spending in January was across the board, from food and liquor to clothing, petrol, and cars,
as well as a bounce back for furniture, hardware, and appliances," business indicators senior manager Neil Kelly said in
a statement.
On an unadjusted basis, retail spending was 5.6 percent higher than a year earlier at $5.13 billion in January, with
spending on fuel up 10 percent to $628 million as global oil prices rose from their lows and a 9 percent increase in
hospitality spending to $1.02 billion. Total card spending, which includes services and non-retail sectors, was up 5.3
percent to $6.73 billion.
The proportion of spending on credit cards was 49.6 percent in January, the first time it's been above 49 percent since
Statistics NZ started measuring the ratio in October 2002, and marking the seventh month of a growing proportion of
spending on credit.
Westpac Banking Corp economist Satish Ranchhod said the increase was "well above market estimates" with a "very
positive" outlook for retail spending in the year ahead.
"Population growth remains strong, employment is up, and we continue to see strong tourist inflows," he said in a note.
"With interest rates still relatively low, and a range of other supportive factors in play, we expect that spending will
remain firm for some time yet."
(BusinessDesk)
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