SYDNEY – A rush on the Apple Inc.'s (AAPL) new iPhone X and Black Friday discounts sparked the biggest monthly rise in Australia's retail sales in around 5 years in November.
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Retail sales jumped 1.2% over the month, three times that forecast by economists, with household goods sales driving the result, the Australian Bureau of Statistics said Thursday. Economists had expected a 0.4% rise in retail sales.
Retail sales had risen 0.5% in October.
The Australian dollar rose to its highest levels since October after the data as traders sensed consumers could be emerging from a period of hibernation, which saw spending slip alarmingly through the spring and winter months.
A sustained surge in full-time jobs growth through 2017, which saw the unemployment rate drop to 5.4% now from 5.9% in March, is likely restoring consumer confidence, who are otherwise faced with record debt levels and flat wages growth.
Analysts this week said some retailers appeared to have had a strong Christmas holiday. Morgan Stanley said electronics retailer JB Hi-Fi, which had been expected to face a stiff challenge from Amazon's recent entry into Australia, actually had a stronger-than-expected Christmas trading period.
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"The Australian launch of Amazon left many concerned that Christmas would be a disaster for the listed retailers," Deutsche Bank analysts said in a recent note. "But our feedback suggests it wasn't."
Deutsche said in addition to JB Hi-Fi, Harvey Norman also performed well over Christmas. The investment bank said that electronics and small appliances took a disproportionate share of consumer spending.
Still, economists said it is too soon to declare consumers have revved up spending again, pointing to the narrow base of the November sales rise, with bustling iPhone sales not likely to be repeated.
"Given wage growth remains subdued and household debt levels continue to rise, it is difficult to fathom retail spending growth substantially stronger," said Janu Chan, senior economist at St. George Bank.
Some warned that Christmas spending might have been pushed forward into November, which might produce a soft result in December.
"If Christmas sales were dragged forward into November as suggested today, the data will be hit punitively by the seasonal factors in December," said Ben Jarman, economist at JP Morgan.
The Reserve Bank of Australia is likely to remain cautious about consumer spending going into 2018. It warned just a month ago of "significant risk" surrounding the outlook for consumer spending, adding weak spending could slow GDP growth.
Interest rates have been held at record lows by the RBA since late 2016, with economists expecting the period of inactivity to stretch on, potentially into 2019.
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(END) Dow Jones Newswires
January 10, 2018 23:06 ET (04:06 GMT)