It wasn’t all bad news for the retail sector last year, as latest figures from CFS Retail show that its high-end shopping centres saw sustained demand from consumers throughout 2012.
Sales across its centres during the 12 months to December 31 increased 1.9 per cent – up from the 1.8 per cent recorded during the September quarter.
There has also been some relief for discount department stores, with figures showing sales decline of 1.9 per cent in the June quarter, improving to a 0.2 per cent fall in the three months until December.
CFS Retail fund manager Michael Gorman highlighted that there are various factors that are currently impacting on consumer sentiment.
He told The Australian: “Consumer spending was up 5.6 per cent, house prices are showing signs of recovery and interest rates continue to fall.
“In addition, we have seen the growth in offshore travel slow and the household savings rate continues its moderate rate of decline.”
This follows the release of the latest Westpac Melbourne Institute Index of Consumer Sentiment, which indicated that consumers are struggling to show a willingness to spend.
During January, the index increased by six per cent to reach 100.6, which made it the third month in a row that the index has been on or above 100 points.
Many analysts had hoped that reductions to the official cash rate would help give consumers the encouragement they needed to start spending, but this has simply not been the case so far.
There has also been positive news on the employment front over recent weeks, as well as data showing that the Australian share market has risen.
However, Westpac chief economist Bill Evans pointed out that people are not parting with their cash at a time when they are traditionally keen to spend.