The latest edition of the Australian Food and Grocery Council-CHEP Retail Index shows year-on-year growth in retail sales at its strongest since early 2010.
The Index was 4.2% higher in December 2013 compared with the same month the previous year, up from an increase of 1.9% between September 2013 and September 2012.
On a quarterly basis, the Index was 4% higher in the December 2013 quarter compared with the December 2012 quarter.
AGFC chief executive Gary Dawson said the strengthening rate of growth suggested the Christmas trading period in 2013 may have been better than analysts had expected for retailers.
The index suggests this upswing is likely to sustain through early 2014, forecasting a year-on-year increase of 4.2% for this month and a 4.2% year-on-year increase for the March 2014 quarter.
Dawson said: “The combined effect of low interest rates and improved consumer confidence after the federal election has seen retailers experience a stronger-than-expected rise in retail sales over the past few months.
“Retailers will be hoping that the labour market also strengthens to support a return to a genuinely strong retail environment.”
Recent movements in Australian Bureau of Statistics retail trade trend data are consistent with this outlook. The latest data shows that year-on-year growth in nominal retail trade picked up to 4.1% over the year to November 2013, taking economists by surprise.
Phillip Austin, CHEP’s regional president, added: “The strong growth since August 2013 is a welcome change. We’re delighted that the retail industry experienced a stronger than forecasted Christmas peak and that the uplift can be expected to continue into the March quarter of 2014.”