Australia's retail boom slowed in April.
Retail sales rose by just 0.1 per cent over March, much less than analysts' estimates and the 1 per cent (revised from 1.1 per cent) growth reported by the Australian Bureau of Statistics for March.
The sharp slowing has eased some of the gathering worries among some bears and analysts that the strong start to 2007 for retail sales, could see the Reserve Bank forced into an interest rate rise later this year.
Shoppers spent a seasonally adjusted $19.013 billion in April, compared to the (downwardly) revised $18.997 billion in March.
Some analysts blamed the timing of Easter, others an 11 per cent rise in petrol prices, while the best explanation was that consumers just took a rest.
The slowdown came despite continuing high levels of consumer confidence which have so far not picked up any concern about petrol prices.
Department store turnover and spending on recreational goods fell in April: department store sales were down 3.4 per cent after that very strong 3.6 per cent rise in March, which included Easter.
In original terms sales in April were 5.1 per cent ahead of April 2006; that was down on the 8.2 per cent growth seen in April, but you can bet that Coles has not experienced anything near this.
(Coles lost another possible suitor last night with Bain Capital apparently out of the buyout group).
Food sales rose 1.4 per cent rise in April, and the question for some broking analysts (and Wesfarmers) would be; did Coles get any of that?
If the departures of CVC and KKR are any guide, the answer could be negative.
The ABS said:
• The seasonally adjusted estimate of turnover for the Australian Retail and Hospitality/Services series increased by 0.1% in April 2007. This follows a revised increase of 1.0% in March 2007 and an increase of 0.9% in February 2007.
• All states and territories except New South Wales (-0.1%), South Australia (-0.7%) and the Australian Capital Territory (-0.9%) had increases in the seasonally adjusted estimate. The largest increase occurred in Tasmania (+1.2%).
• In original terms, Australian turnover decreased by 4.4% in April 2007 compared with March 2007. Chains and other large retailers (which are completely enumerated) decreased by 4.1%, while the estimate for 'smaller' retailers (the sampled units) decreased by 4.8%.
• Australian turnover increased by 5.1% in April 2007 compared with April 2006. Chains and other large retailers increased by 4.9%, while 'smaller' retailers increased by 5.4%.
……..
The ABS also released figures yesterday showing $27.2 billion of construction work was completed in the first three months of the year, a rise of 2.7 per cent from December quarter of last year.
Construction activity increased in the first quarter of this year, and could imply a stronger than expected outcome of the next set of economic growth figures and the private capital expenditure figures which are due to be released later today.
The total construction work done was valued at $27.234 billion, from $26.519 billion in the December quarter.
Building work rose to $15.544 billion, from $15.424 billion, and engineering work to $11.689 billion, from $11.095 billion.
That rise in engineering work done was particularly strong, up 5.4 per cent in the quarter and almost 11 per cent in the year to March, while residential work done rose a healthy 3.4 per cent in the quarter.
And while non-residential construction work done fell 3.1 per cent, it was still up 7.4 per cent over the year.
Economists say the already reported 2 per cent growth in first quarter retail sales and now a 2.7 per cent growth in construction work done in the same quarter, are pointing to the possibility of strong economic growth figures in the national accounts next Wednesday.
