Despite high inflation, Kiwis continued to get back to the retail therapy in April with adjusted debit and credit card spending rising by $551 million or 7 per cent, Stats NZ says.
This was a larger increase than was seen in the previous month, when spending rose by only 1.7per cent.
Total actual spending using electronic cards was $8.1 billion, up 2.9 per cent from April 2021.
"That was a larger rise than we had expected," said Westpac senior economist Satish Ranchhod
"Helping to boost spending appetites through April was the easing in health restrictions, which saw a solid rise in hospitality spending over the Easter, school holidays period."
The rise in spending was widespread however, with increased spending on groceries (+5 per cent), apparel (+17 per cent) and continued firmness in spending on durables (up 1 per cent).
"These broad-based gains point to resilience in spending appetites, especially given high fuel prices which has constrained spending in other areas," Ranchhod said.
"But while we are seeing resilience in nominal spending, the level of spending is only now back around those we saw prior to the Delta outbreak."
"That means some of the gains we've seen will reflect the impact of price rises rather than an increase in the volume of goods being sold."
ASB senior economist Mark Smith also warned of headwinds for consumer spending in the months ahead.
"Our view remains that, despite the strong April bounce, retail spending is unlikely to show the same vigour in 2022 as it did during a stellar 2021," he said.
"The cost of living is now soaring, with annual CPI inflation set to remain around 7 per cent over the first half of 2022 and with sharply rising debt servicing costs for households."
A cooling housing market outlook and the hits to local and global equities over 2022, as well as ongoing Covid-19 caution highlighted the challenges facing the retail sector and wider household spending, he said.
"Easing border restrictions into NZ will support the hospitality sector and travel-related domestic retail, but this will also encourage more Kiwis to head and spend overseas rather than buy locally and nest build. Soft consumer sentiment readings point to a weak consumer spending outlook."
The hospitality sector was still down almost 5 per cent compared to a year earlier.
Hospitality sector spending has been slowest to recover.Photo / NZME
Spending in the hospitality industry fell by $56 million (4.9 per cent) between April 2021 and April 2022.
Due to the effects of Covid-19 on tourism, StatsNZ was unable to release seasonally adjusted figures for the hospitality industry.
Covid-19 had introduced unusual patterns to the monthly and quarterly electronic card transaction series.
"We are confident in the seasonal adjustment of the core retail total, total retail, and total card-spending series," StatsNZ said.
But the hospitality industry was yet to see a clear seasonal pattern return to it, and so we have decided not to publish either the monthly or quarterly series until we have confidence in the quality of these series, it said.
Easing Covid-19 restrictions and the spate of long weekends that month saw sales in hospitality jump 23 per cent in non-seasonally-adjusted terms over the month.
"However, this was still 11 per cent below July 2021 levels and back to where it was at the start of the year," Smith said.
In actual terms, cardholders made 146 million transactions across all industries in April 2022, with an average value of $56 per transaction.
The total amount spent using electronic cards was $8.1 billion.
