New Zealand Q4 retail sales ex-inflation +0.9% q/q (est 0.6%; prev 1.9%)
TL;DR
New Zealand's Q4 2024 retail sales grew 0.9% quarter-over-quarter, exceeding forecasts and marking a second consecutive rise, signaling economic recovery from recession. The rebound is attributed to RBNZ rate cuts and improved consumer sentiment, though sector performance was mixed.
New Zealand Q4 retail sales ex-inflation +0.9% q/q (est 0.6%; prev 1.9%)
New Zealand Q4 Retail Sales Rise 0.9% QoQ, Outpacing Forecasts
New Zealand's retail sales rebounded in the fourth quarter of 2024, growing 0.9% quarter-over-quarter, surpassing the 0.6% forecast and following a 1.9% increase in the prior quarter. The data, released by Statistics New Zealand, marks the second consecutive quarterly rise in retail activity after a prolonged period of contraction. This trend aligns with broader economic signals suggesting the country is emerging from a recession that saw GDP contract 2.1% in the six months through September 2024.
The Reserve Bank of New Zealand (RBNZ) has played a pivotal role in this recovery, implementing aggressive rate cuts in late 2024. After reducing the Official Cash Rate by 150 basis points across three consecutive 50-basis-point cuts in October, November, and February, the OCR now stands at 3.70%. Lower borrowing costs and improved consumer sentiment are widely seen as catalysts for the retail rebound.
Sector-specific data highlights a mixed performance. While department stores, electrical goods, and hospitality spending surged—partly driven by summer tourism— grocery and automotive sales declined. The RBNZ estimates Q4 GDP growth at 0.3%, with Chief Economist Paul Conway projecting a stronger recovery in 2025, fueled by a weaker exchange rate and higher agricultural export prices.
The retail upturn follows a January manufacturing expansion—the first in nearly two years—and reinforces the government's optimism ahead of the 2026 general election. However, challenges persist, including subdued grocery sales and the need for sustained consumer confidence. With fourth-quarter GDP data slated for release on March 20, further clarity on the economy's trajectory will likely influence the RBNZ's monetary policy path.
According to Bloomberg: New Zealand Retail Sales Rebound in Sign Recession Has Ended, February 23, 2025.
