SYDNEY (Reuters) -Australian retail sales surged in June as the launch of Nintendo’s Switch 2 and discounting at the end of the financial year drew consumers back to the shops, though sales volumes for the second quarter as a whole were subdued.
Raising hopes that a long-awaited recovery in consumption could be on the way, retail sales jumped 1.2% in June from May, when they rose 0.5%, data from the Australian Bureau of Statistics showed.
That was well above forecasts of a 0.4% increase and marked a second straight month of gains as well as the biggest monthly climb since March 2022.
“After steady growth throughout the year, mid-year sales events increased spending on discretionary items like furniture, electrical goods and clothing items,” said Robert Ewing, the bureau’s head of business statistics.
“Turnover for electrical and gaming retailers was lifted further by the much-anticipated launch of the Nintendo Switch 2, which delivered record sales.”
The data is not expected to have much impact on interest rate policy. Investors are pricing in a near-certain chance that the Reserve Bank of Australia could lower its cash rate of 3.85% by a quarter-point next month. Rates are seen bottoming out near 3.1% by early next year.
The RBA has cut interest rates by 50 basis points since February, but consumers have stayed stubbornly frugal, choosing to save windfalls from tax cuts rather than spending.
Thursday’s report showed sales gained across the board, except for spending at cafes and restaurants. Spending on household goods items jumped 2.3% while spending at department stores surged 1.9%.
For the quarter, sales volumes edged up 0.3%, better than forecasts for a flat result, but still historically sluggish, especially given strong population growth.
It was the last set of data for the retail sales series, which will be replaced by a monthly household spending indicator that covers 68% of household consumption, more than double the retail survey.
(Reporting by Stella Qiu and Wayne Cole; Editing by Edwina Gibbs)
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