CHEP Index predicts retail sales growth to continue slowing through 2019
CHEP Retail Index: A lead indicator of Australian Bureau of Statistics retail trade data, based on transactional data from CHEP pallet movements.
3 May 2019 - Sydney Australia - Figures published in the latest edition of the quarterly CHEP Retail Index, which uses transactional data from CHEP pallet movements to provide a lead indicator of Australian Bureau of Statistics retail trade data, predicts retail sales growth to continue slowing through 2019.
Index: Key figures
- 2.8% year-on-year retail growth for June 2019
- Turnover of $27.2 billion in March 2019, with year-on-year growth for the month of March increasing to 2.9%
- On a quarterly basis, 2.9% year-on-year growth for the March quarter and decreasing to 2.7% for the May quarter.
Retail turnover is expected to continue slowing through 2019, with the CHEP Retail Index estimating year-on-year growth to June 2019 of 2.8%. The retail sector is expected to soften further as falling house prices combined with subdued income growth reduce consumer willingness to spend.
Weakness in the housing market combined with a subdued wage environment is reducing consumer willingness to spend. In a more cautious economic environment of 2019, consumers are now no longer as willing to run down their rate of savings.
A weaker trend in pallet movement data indicates retailers are expecting a difficult environment in 2019.
Providing commentary on the Index, David Rumbens, partner at Deloitte Access Economics, comments that, “After a dismal Christmas period, retailers are more cautious heading into 2019. Significant house price falls have dented consumer confidence and their willingness to spend. There are tax cuts on the way, but they’re not here yet, so mid 2019 may mark a low point in the retail cycle.”
President of CHEP Asia Pacific, Phillip Austin, said, “As the retail landscape shifts to meet consumer trends, retail supply chains are focusing more than ever on efficiency and effectiveness. CHEP is increasing its investment to support customers to meet these challenges, developing new pallets and crates that enable flexible fulfillment and enabling Internet of Things (IoT) track and trace capabilities across the supply chain.”
The CHEP Retail Index analysis and commentary is provided by Deloitte. It is recognised as a reliable lead indicator of Australian Bureau of Statistics retail trade data.
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