February retail spending up, hospitality lags on Valentine’s boost

Kiwis spent more in February according to new data from Stats NZ.

Retail spending had a slight uptick in February as the economy continues to slowly recover, although those in the hospitality industry would have been hoping for a bigger Valentine’s Day boost.

Spending in retail industries in February increased by 0.3% ($22 million) compared with January, according to Stats NZ.

Spending in core retail industries rose by 0.5% ($28m).

The largest spending growth in February was in the apparel category, which grew by a sizeable 1% ($3.4m).

Kiwis also spent more on consumables, which grew by 0.6% ($16m).

The category with the biggest drop in spending was motor vehicles (excluding fuel), in which spending was down by 0.3% ($500,000).

Durables were also down for the month, with spending falling by 0.1% ($1.1m).

Hospitality spending fell in February with Valentine’s Day perhaps not having as big an impact as hoped, falling by 0.1% or $1.2m compared with January.

The fuel category remained unchanged for the month, as ongoing changes to fuel prices have their impact.

Services, including repair and maintenance, personal care, funeral and other personal services, reported a spending decline of 0.4% ($1.4m) in February.

Spending in the non-retail (excluding services) category was unchanged in February.

That category included medical and other healthcare spending, travel and tour arrangements, postal and courier delivery, and other non-retail industries.

The total value of electronic card spending, including the two non-retail categories (services and other non-retail), was unchanged for the month.

In actual terms, cardholders made 156 million transactions across all industries in February 2025, with an average value of $55 per transaction.

The total amount spent using electronic cards was $8.6 billion.

Encouraging signs

Westpac senior economist Satish Ranchhod said the result was in line with the bank’s forecast.

“Stepping back and looking at the longer-term trend, we are seeing some encouraging signs. Spending has been trending higher for about half a year now,” Ranchhod said.

“However, the recovery in spending has been gradual. Despite increases in recent months, spending is only back around the levels we saw at this time last year.”

“Furthermore, the lift in spending to date has mainly been related to increases in spending on groceries, where there have been some sizeable price rises.”

He said the impact of interest rate cuts is still yet to be felt, with many mortgages yet to come up for refixing.

“However, we’re now watching events offshore. The increasingly rocky global backdrop could dent confidence. It could also affect financial conditions in New Zealand, and that could be important for spending appetites.”

Tom Raynel is a multimedia business journalist for the Herald, covering small business and retail.