New Zealand Retail Spending Falls 1.3% in September

Core retail transactions in New Zealand fell 1.3% in September, totaling $3.572 billion, according to data from the Paymark payments network. This decline follows a 1.8% drop in August, signaling a continued slump in consumer activity. While spending at fuel outlets rose 35% year-on-year due to higher prices, non-food spending plummeted from 0.9% above year-ago levels in early July to 7.1% below those levels by late September.

Paymark Chief Sales Officer Bruce Proffit attributed the downturn to a triple-whammy of sharply rising petrol prices, an increase in the Official Cash Rate from 2.25% to 2.75%, and severe weather during the final weekend of the month. Regional results varied, with growth in Gisborne and Hawke’s Bay, while Auckland saw a 1.7% decrease and Marlborough experienced a 9.7% annual drop.

Retail NZ Chief Executive Carolyn Young noted that households remain cautious as rising fuel and mortgage costs deplete spare money for discretionary spending. This sentiment is mirrored in the ANZ-Roy Morgan New Zealand Consumer Confidence index, which dipped 0.4 points to 97.6. ANZ economists described the broader economy as a mixed bag, noting that while a low New Zealand dollar supports tourism and exports, consumers continue to struggle with cost-of-living pressures and an elevated unemployment rate. Retailers now face a slower start to the pre-Christmas shopping season amid uncertainty surrounding an upcoming election.