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Consumer spending patterns confuse the GST prophets of doom

CONSUMPTION data released recently continues to confuse experts.

Consumer spending patterns are difficult to interpret as the economy adjusts to the new tax system.

However, the underlying consumption growth remains relatively strong. The latest ABS data indicates retail turnover in WA lifted by 5 per cent in August. July’s figure saw a substantial fall, of about 9.3 per cent.

In the three months to August, retail sales increased by 6.6 per cent relative to a year earlier and by 4.7 per cent in annual average terms.

In contrast, motor vehicle registrations fell by 16 per cent in August, following a massive increase of 95.1 per cent in July.

Registrations rose by 0.8 per cent in the three months to August relative to a year earlier but fell by 8.3 per cent in annual average terms.

Overall consumer spending is expected to remain strong during 2000-2001, underpinned by continued moderate employment and wages growth.

WA’s main growth areas were department stores (up 26 per cent) and clothing and soft good retailing (up 13 per cent). Turnover in household goods retailing recorded the only decline (down 0.7 per cent).

The national figures for August and the year to August were broadly consistent with the WA picture.

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