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Summary
- Despite a 0.7% contraction, in year-on-year terms, the growth in the index is among the strongest in the series history.
- Small sales category, takeaway food led the growth charts while larger sales categories such as homewares and appliances, grocery and liquor, contracted.
- Australians spent $42.2 billion on online retail in the 12 months to October.
National Australia Bank Limited (ASX:NAB) Online Retail Sales Index contracted in the month of October following strong growth in the previous four months. The index shrank 0.7 per cent in October against a growth of 1.2 per cent in September, on a month-on-month, seasonally adjusted basis. Even as the index may have slowed, it remains among the strongest growth in its history at 59.3 per cent in year-on-year terms.
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While the small sales category led the growth charts, takeaway food, larger sales categories such as homewares and appliances, grocery and liquor, and department stores contracted. The larger sales categories saw a rise between 55 per cent and 80 per cent in year-on-year terms. New South Wales and South Australia rebounded after seeing contraction in September, along with robust sales growth in the Northern Territory in month-on-month terms.
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Even as all other states posted contraction in October, sales growth remains robust in comparison to October last year. Online sales for Victoria may have slowed down in year-on-year terms, they are still over double as against in October 2019. While most metros shrank, regional areas saw improvement from a contraction in sales in September to post no growth last month. In month-on-month terms, growth in sales for both domestic and international merchants saw contraction. Australians spent $42.2 billion on online retail in the 12 months to October. It is estimated to be about 41.2 per cent higher than the corresponding period of last year.
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NAB Chief Economist, Alan Oster, said that the index continues to grow strongly and is up nearly 60 per cent in year-on-year terms. Takeaway food category has yet again led the growth in October in year-on-year terms, Oster said, adding that the category’s share of the index has also surged with a relatively robust growth over this period. Earlier the category accounted for nearly 3.5 per cent of the index, now with its fast growth it represents about 5 per cent, he said.
