Discounting lured customers in while rising prices fuelled an increase in food-related spending, causing retail sales to increase more than anticipated.
After an April result that was flat and a March result that was up 0.4%, the robust May increase of 7.0% came.
According to the Australian Bureau of Statistics, increased expenditure on food and eating out, as well as an increase in non-essential purchases, had a positive impact on retail turnover.
The head of statistics, Ben Dorber, stated that the most recent increase “reflected some resilience in spending, with consumers taking advantage of larger-than-usual promotional activity and sales events for May.”
He claimed that people were probably being pushed by the rising cost of living to take advantage of sales, much like they did on Black Friday in 2022.
The sector with the highest increase for the month was other retailing, which includes online-only merchants, florists, and retailers of drugs and cosmetics.
The ABS attributed this rise to Mother’s Day, the Click Frenzy Mayhem promotions, and an early start to end-of-financial-year discounts.
Retail sales of household products increased by 0.6% despite the fact that this rise came after three straight months of declines.
Department stores and apparel, footwear, and personal accessories were two additional significant discretionary categories that saw monthly declines of 0.5% and 0.6%, respectively.
It came after sales increased in April as a result of consumers spending more on warmer clothing due to the colder-than-normal weather.
The total revenue for cafes, restaurants, and takeaway food services increased by 1.4%, while food retail had a 0.3% increase in revenue.
According to Mr. Dorber, the increase in spending on food was mostly a result of inflation, with the consumer price index showing a 7.9% increase in food prices in the year ending in May.
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