Sarah McMillan/cvnznews.com
New Zealand’s retail sector has hit another patch of turbulence, with new data showing shoppers kept a tight grip on their wallets throughout August. Retail NZ says households are feeling the squeeze from rising fuel costs and economic uncertainty, leaving overall spending flat compared to the same time last year.
Electronic Card Transaction figures from Stats NZ show core retail spending sat at 0.0% growth, a sharp contrast to July’s strong 3.5% lift. Total retail card spending rose just 0.8%, and even that modest increase was largely held up by fuel purchases — still growing at 4.4% year‑on‑year despite easing from the double‑digit spikes seen earlier in 2026.
Retail NZ Chief Executive Carolyn Young says July was an anomaly, boosted by Matariki, the men’s Football World Cup, an extra trading weekend, and stable petrol prices. August, she says, marks a return to caution.
Durable goods spending, which surged in July, was completely flat. Hospitality dropped 1.8%. Consumables rose only 1.4% — well below inflation. Apparel retailers were hit hardest, with a 2.5% year‑on‑year decline that Young says will be “a blow” for a sector hoping July signalled a turnaround.
Young points to several pressures weighing on shoppers: the widely expected 0.25% OCR rise in early September, fuel averaging more than $3 per litre since late July, high unemployment, and pre‑election uncertainty. Consumer confidence remains stuck below 100, indicating pessimism.
“Retail has been variable,” Young says, noting that many households may be tightening up after July’s burst of spending. She says some families appear to be adopting a “wait‑and‑see” approach as the election draws closer.
There is some good news. Tourism numbers returned to pre‑COVID levels in July, offering hope as retailers head into spring — traditionally a stronger period for apparel and outdoor goods. Young says stores will be relying on a spring lift and rising tourist activity to carry them into the crucial holiday season.
“Many retailers depend on strong summer sales to get them through quieter months,” she says. “The next few weeks will matter.”
