Mail order helps lift sales in Australia for January

Mail order and telephone order providers recorded the strongest spending growth. Photo / Thinkstock

Australian retail spending rose in January, led by sales in clothing stores and by mail order or telephone order providers.

The Commonwealth Bank business sales indicator rose by 0.6 per cent in trend terms in January, after 0.7 per cent gains in November and December.

The indicator, which tracks the value of credit and debit card transactions processed through CBA's point-of-sale terminals, recorded rises in spending in all states for the fourth straight month.

Clothing stores and mail order and telephone order providers recorded the strongest spending growth, up 2.3 per cent and 2 per cent, respectively.

CBA local business banking executive general manager Matt Comyn said businesses were benefiting from the continued rise in sales at the start of the year.

"Despite ongoing economic concerns being felt both here and overseas, sales figures in most industries are ticking up and have been for some time now," Comyn said.

"That means that there is still a certain level of confidence among consumers, even if it is relatively weak.

"While the improvements are a good sign, there are a range of factors that contribute to consumer confidence; the ongoing fluctuations we are seeing in the global economy, therefore, make it difficult to forecast how strong the recovery will be," he said.

CommSec chief economist Craig James said the sales figures justified the Reserve Bank of Australia's decision not to cut the cash rate at its February board meeting.

"We have seen economy-wide spending growing again in January and the results also align with the Reserve Bank's view that activity in the services sector has generally proved stronger," James said.

"It appears that the growth many had hoped for has continued into the start of the year," James said.

"However, we will need to see ongoing improvements in consumer confidence for that trend to continue and for the associated benefits to be felt by a larger number of businesses."

- AAP