Cash registers to ring merry tune

Retailers can expect a bountiful Christmas selling season, with the Retail Association predicting an increase in December sales on last year of 7 per cent.

Association chief executive John Albertson said anecdotal evidence showed that electronic transactions, a good indicator of retail spending, were up around 7 per cent in November and the early part of December.

He expected the increase in credit card and Eftpos transactions to translate into an increase in retail sales.

"I'd like to think that the full month will be up 6 per cent to 7 per cent on last year," he said.

Retailers had not suffered greatly from the cool weather, however, sales of so-called "durable goods" - furniture, electronics and whiteware - had been outperforming non-durable goods for months. The data for December will show to what extent plasma screen TVs and lounge suites take up the slack for product segments that rise and fall with weather patterns.

"It's obviously critical what will happen over the next 11 days. It's a knife edge we always sit on in the run up to Christmas," said Albertson.

Official retail figures for October are due out today from Statistics New Zealand.

The Bank of New Zealand's chief economist, Tony Alexander, expected unadjusted sales in October to be up 5.5 per cent on a year ago.

He pointed out that a "recent surge" in consumer spending came in spite of interest rate rises, but added that this year's official cash rate increases, slowing employment and population growth and falling house prices would begin to slow growth.

Nevertheless, the BNZ is picking strong Christmas sales as people spend on the back of several years of strong economic growth. A One News/Colmar Brunton Poll has reported a jump in consumer confidence, with 40 per cent of respondents thinking the economy will be in better shape during the next 12 months - up 5 per cent from November.

The BNZ had received feedback from the retail sector that sales were slowing across several "store types".

"This may reflect the fact that competition among retailers has increased ... ," Alexander said.

Auckland, the country's biggest retail market, has been underperforming, says the BNZ.

In the three months to November, consumer spending was up 4.5 per cent from a year ago, compared with the national average of 6 per cent.

Selling out

* The Retail Association expects retail sales growth for December to increase 6 per cent to 7 per cent on an annual basis.

* Official figures are expected to show reasonable sales growth for October, with the BNZ tipping an unadjusted sales increase of 5.5 per cent on a year ago.

* Consumer spending in Auckland lagged behind the national average in the three months to November.