New Zealand retail sales flat in Q3, sparking sell-off in the local currency

[WELLINGTON] New Zealand quarterly retail sales were flat in the third quarter, data from the country's statistics agency showed on Monday, shy of market expectations and pushing the kiwi currency to a 12-day low.

Seasonally adjusted by stripping out the effects of rising fuel prices, retail sales volumes rose 2.7 per cent annually but were unchanged on the quarter, short of economists' forecasts for roughly a 1 per cent rise.

The New Zealand dollar fell from US$0.6784 to US$0.6755, its lowest since mid-November, after the figures were released.

The result suggested "a lull" in consumer spending, led by consumers holding off on buying food and motor vehicles, according to Statistics New Zealand. The figures could underscore the cautious approach of the country's central bank, which has stuck determinedly to its neutral tone and warned of risks to the growth outlook, including the chance tepid consumer spending, despite a recent slew of strong economic data.

A new tax on fuel in the country's largest city, Auckland, did see the overall value of retail sales rise, though still by just 0.6 per cent. "The rise in fuel sales was offset by falls in the food and beverage and the vehicle industries this quarter," said Sue Chapman retail statistics manager at Statistics New Zealand.

REUTERS