Australians defy income fears and keep shopping

Sydney

AUSTRALIAN shoppers kept spending in October to help retail sales notch up the best two-month performance this year, a hopeful sign consumers were weathering a slowing economy and falling incomes.

Thursday's data from the Australian Bureau of Statistics also showed the country's trade deficit shrank by more than expected in October, thanks to a bounce in exports. Shipments to China surged 27 per cent in original terms compared to September even as prices for Australia's resources took a beating. The upbeat news came as a relief after figures out on Wednesday showed the economy grew just 0.3 per cent in the third quarter, less than half the pace analysts expected and the smallest increase since early 2013. Retail sales rose 0.4 per cent in October, handily outpacing forecasts for a flat outcome, while September was revised up even further to show a jump of 1.3 per cent.