Card spending down slightly in July, retail takes a hit

Card spending was down in July with car sales and clothing retailers taking a hit but some services had a better month.

Stats NZ today said the value of electronic card transactions was down 0.1% or $6.3 million from June.

Spending in core retail industries decreased 0.5%.

Stats NZ said card spending in hospitality fell 1.4% and in apparel it was down 2.1%.

Durable and consumables had smaller declines, falling 0.4% and 0.2% respectively.

But for the motor vehicle sector, excluding fuel, transactions fell 2.7%.

Card spending on fuel was down 1.6% last month compared to June.

The non-retail category excluding services was up 2.1% from June.

“This category includes medical and other health care, travel and tour arrangement, postal and courier delivery, and other non-retail industries,” Stats NZ said.

And the services category was up 0.7%.

That category included repair and maintenance, personal care, funeral services and other personal services.

“In actual terms, cardholders made 161m transactions across all industries in July 2024, with an average value of $55 per transaction,” Stats NZ added.

“The total amount spent using electronic cards was $8.8 billion.”

Westpac economists said this was the sixth successive month of an overall retail spending drop.

“In fact, over the past year, spending on hospitality is down 9%, spending on household durables is down 10%, and spending on apparel is down 11%,” the Westpac economists said.

“Looking forward, households’ purchasing power will get a boost from tax cuts and other support measures, as well as falls in interest rates.

“But with borrowing cost still at high levels and the labour market weakening, spending is likely to remain subdued through the final months of the year.”