“Part of this will be attributed to higher prices, but even so, there seems to be a lot of ‘catch-up’ spending going on by consumers, particularly in the apparel sectors, footwear and personal accessories and department stores,” he said.
ANZ senior economist Adelaide Timbrell said one of the factors supporting the retail sector was the gradual return of tourists and expatriate Australians.
A net 110,600 people entered the country in July compared to a net outflow of 150,500 people in June.
Timbrell said net overseas arrivals would continue to support retail trade, downplaying concerns that the sector is poised for a sharp downturn.
“We expect a slowdown in consumption eventually, and the spending observed by ANZ shows a slightly slower momentum in spending in August compared to ‘normal’ seasonal variation, but we are still far from seeing a cliff in expense,” he said.
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But Commonwealth Bank senior economist Belinda Allen warned that July’s rise largely came before consumers began to feel the full impact of that month’s interest rate rise .
“At the Commonwealth Bank, for example, there is on average a three-month delay between a cash rate rise and the higher refund being deducted from a customer’s bank account,” he said.
“Between August and December, this interest rate impact quadruples depending on the policy changes already announced. This impact will increase again depending on what the RBA does to the cash rate in September and beyond.”
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