May retail sales jump more than tipped

Retail sales rose more than expected in May as government assistance for students and the carbon tax began flowing into households.

Sales for the month rose 0.5 per cent from April, beating the 0.2 per cent increase expected by economists.

Retail trade rose in the month to a seasonally adjusted $21.307 billion, compared with a revised $21.199 billion in April, the Australian Bureau of Statistics said.

The ABS revised the April figure to show a 0.1 per cent increase - making it five consecutive monthly increases and the longest string of rises for the gauge since September 2010.

The Reserve Bank slashed interest rates by half a percentage in May, a move it followed up with a further quarter-point cut in June. Both cuts would have helped those repaying variable interest-rate loans. The central bank opted to leave its key cash rate unchanged at 3.50 per cent yesterday.

Commonwealth Bank economist James McIntyre said the carbon tax household assistance package was delivered in mid-May and would run though to mid-July.

“On our estimates we thought the sum of that would be spent in the retail sector and it looks like that happened in May,” he said. The assistance will likely deliver strong retail sales readings in June and July.

“But then we should potentially see some weaker number as we stop cycling that mini-stimulus in August,” he said.

Households may also have been cheered by the government's pledge to lift its assistance for school-age students.

The strength of retail sales made an August rate cut less likely, he said, which helped boost the dollar to $US1.0315 from $1.029 before the data was released.

Among the states, retail sales increased 0.7 per cent in seasonally adjusted terms in New South Wales, its third consecutive monthly rise. In Victoria retail sales rose 0.5 per cent in May, matching the increase in Queensland, the ABS said. In Western Australia retail sales jumped 1.1 per cent for the month.

http://www.smh.com.au/business/may-retail-sales-jump-more-than-tipped-20120704-2...

Hard Righters -> Greens and Labor, fantastic managers of the economy aye !

Yay free money from the Government.

Who's paying?

Just the 'polluters' hey???

So if its just the 'polluters' who pay, why does the Government's Treasury modelling forecast that households will pay $9.90 in higher costs each week?

Not at all, not all households are being overcompensated.

Ex Dame Pansi wrote on Jul 4^th, 2012 at 12:41pm:

The people know how to spend money responsibly. Gillard says so.

The uptick in retail spending is surely not linked to government handouts, because that money was meant for added costs to current goods and services you use. Does that mean this is all infationary or one off spending blitz by the responsible public. Back to being poorer than you thought you were poor for the next 6 or 12mths, then spending blitz next time labor bye your vote.

____ wrote on Jul 4^th, 2012 at 12:13pm:

Dsmithy70 wrote on Jul 4^th, 2012 at 12:57pm:


thats hardly a fair representation of the argument. you rely on stereotypes and extremes. Maybe what people are complaining abotu is the principle of contributing more already then being asked to pay even more all the while being hated by the govt in the same process.  why should a govt payment depend on the need of the recipient? why shoudl hard work and responsible management of money be punished while sloth and waste be supported? there is a principle here. The trouble is (as you know) as soon as you talk about 'principle' you lose all but about 3 people who really dont understand that they are and simply revert to circumstances.