Westpac comments on the strong retails sales report from Australia today:

  • The September retail report was much stronger than expected
  • Monthly sales and Q3 real retail sales coming in well above expectations
  • Strongest monthly gain since Nov 2009 (but only just)
  • The detail shows an extraordinary 9.2%mth jump in ‘electrical and electronic goods retailing’. That jump may reflect the launch of the iPhone 6 although the launch came late in the month and previous iPhone versions released each year around the same time have not resulted in similar jumps. Sales ex this category were up a solid but less spectacular 0.7%mth
  • Aside from the jump in electronics, the other category detail did show fairly broad based gains in both the month and the quarter
  • Broader picture from the September retail report is still more positive than had been expected. That in turn suggests demand momentum has firmed in the third quarter. How well this sustained into the year end remains unclear. Consumer sentiment remains downbeat and appears fragile.