Spending Patterns Look Up As Tough Winter Ends

AUCKLAND, 4 September 2024 – August saw the end of the typical winter spending slump and the start of a rising spending pattern that usually runs into Christmas, giving retailers hope that a pickup in annual spending growth is also imminent.

Data released by Worldline NZ today shows consumer spending through Core Retail merchants (excluding Hospitality) in its payments network reached $2.89B in August 2024, down -0.5% from August 2023. This compares with the annual decline of -2.6% seen in July.

Worldline NZ’s Chief Sales Officer, Bruce Proffit, says although spending did increase weekly from the second week of August onwards, spending for the month overall remained below levels seen at the same time last year.

“There is a temptation to attribute the rising spending trend within the month to interest rate cuts and improving business confidence levels. While these factors are likely to feed through to increasing spending, the improved trend seen during August was largely due to the usual seasonal increase that occurs at this time of year,” says Proffit. 

“There is no doubt that it has been a tough winter for merchants, and the seasonal lift in spending that tends to occur around now and run into Christmas will be extra welcome this year,” he says.

“That the spending gap between last year and this year narrowed slightly will also be a relief. Hopefully the worst is now behind, both for retailers and their customers.”

Figure 1: All Cards NZ underlying* spending through Worldline for the 11 weeks ending Saturday July-September 2023 and 2024 (to date) for core retail excluding hospitality merchants (*underlying excludes large clients moving to or from Worldline)

Meanwhile, the regional annual growth for Core Retail merchants (excluding Hospitality) was highest in Wairarapa (+2.1%) and Otago (+1.9%). The annual spending decline was largest in Southland (-7.5%), Bay of Plenty (-4.2%), and South Canterbury (-5.0%). Noticeably, the annual spending gap has narrowed since July in Auckland/Northland (-1.2% in August versus -3.6% in July).

Figure 2: All Cards NZ underlying* spending through Worldline in August 2024 for core retail excluding hospitality merchants (*Underlying excludes large clients moving to or from Worldline)

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