16 Jan 2019

Consumers cautious on spending heading into holiday period

2:30 pm on 16 January 2019

Consumers were cautious about their spending going into the holiday period.

Credit cards for payment.

People spent less in December on fuel, appliances, furniture, electronics and clothing using debit and credit cards. Photo: 123RF

Official numbers show spending using electronic cards, such as debit and credit cards, fell a seasonally adjusted 2.3 percent in December on the previous month.

The biggest fall was in spending on fuel, which fell 8 percent and coincided with the fall in petrol prices.

There was also reduced spending on appliances, furniture and electronics, and clothing.

"Those savings at the pump don't appear to have leaked across to other retail industries," Stats NZ spokesperson, Sue Chapman said.

Leaving aside fuel and vehicle related spending, core e-card sales fell 1.5 percent.

Spending in supermarkets was marginally higher, but in bars and restaurants unchanged.

New shopping events such as Singles Day, Black Friday, and Cyber Monday - all of which are in November - may have also pre-empted Christmas-related spending, while retailers were also discounting prices ahead of the holidays.

An economist said the retail outlook was subdued.

"The becalmed housing market and weaker population growth will likely weigh on overall retail spending growth, and 2019 could be a testing year for the retail sector," ASB senior economist Mark Smith said.