{"id":155089,"date":"2019-09-09T13:55:44","date_gmt":"2019-09-09T17:55:44","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=155089"},"modified":"2019-09-09T09:50:55","modified_gmt":"2019-09-09T13:50:55","slug":"nz-august-electronic-card-retail-sales","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/09\/nz-august-electronic-card-retail-sales\/","title":{"rendered":"NZ August Electronic Card Retail Sales"},"content":{"rendered":"
September 9, 2019<\/div>
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By <\/strong>Orbex<\/strong><\/a><\/p>\n

Unlike most other countries, New Zealand does not publish it\u2019s consumer confidence data on a monthly basis. We only get that information once each quarter. So, in order to get a better view of the changes in consumer sentiment, analysts turn to proxies. These are other data sets that reflect how willing New Zealanders are to spend.<\/p>\n

Chief among them, and therefore likely to be the most important data point for New Zealand this week is tomorrow\u2019s Electronic Card Retail Sales. Sometimes it causes the market to change course. It could be especially relevant this time around since the RBNZ is trying to spur consumer spending and credit by cutting the rates.<\/p>\n

We could expect to see expansion in electronic card transactions if the central bank\u2019s policy changes are reaching their goals.<\/p>\n

What We Are Expecting<\/strong><\/h2>\n

Expectations are for Monthly Electronic Card Retail Sales to decline by -0.1%.\u00a0<\/strong>This would be a repeat of the prior month\u2019s figure. On an annualized basis, that would imply a slowing of the pace of growth to just 1.2% from a prior of 1.6%.<\/p>\n

Card sales have a habit of bouncing between -0.5% and 0.5% on the monthly measurement. Therefore, we would expect a stronger reaction in the market to occur if the result were beyond those ranges. Higher\u00a0retail sales<\/a>\u00a0imply better consumer sentiment. And this would reduce the likelihood of further RBNZ action. So, we could see the NZD get stronger in that scenario. The opposite would happen with a negative number<\/p>

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The Long Term Numbers<\/strong><\/h2>\n

Slowing sales growth on an annualized basis is likely more concerning to regulators. Typically buying with credit cards increases well above 1.0%. And the figure seems to be settling near the bottom of the range. A lack of consumer spending would lead to flagging inflation. It would also be in line with the\u00a0outlook expressed by many NZ businesses<\/a>\u00a0that performance will remain poor for the rest of the year.<\/p>\n

Credit cards, in particular, are especially relevant. This is because they\u2019re related to interest rates, which are supposed to be dropping due to the RBNZ. Theoretically, people should be more encouraged to spend on credit because of the lower cost.\u00a0But if sales aren\u2019t improving, it might mean the central bank\u2019s rate cuts were not enough.<\/strong><\/p>\n

The R<\/strong>ecent Moves<\/strong><\/h2>\n

Over the last couple of trading days, the Kiwi has found itself supported primarily by external factors. Friday\u2019s lower than expected NFP in the US suggested that the Fed might be more willing to take action. This would supply more liquidity to markets and support carry flows to New Zealand.<\/p>\n

Over the weekend, the PBOC reduced reserve requirements. This allows for more liquidity in its banking system, which would be expected to support buying NZ products.<\/p>\n

As mentioned previously, New Zealand seems to be avoiding some of the more negative impacts of the trade war because their primary exports to China are for consumer goods on the domestic market. But, this hasn\u2019t been enough to prevent the economy from following a similar trajectory as Australia\u2019s.<\/p>\n

Without other factors getting in the way, though, it wouldn\u2019t be surprising for the NZD (and AUD) to strengthen leading up to next week\u2019s FOMC meeting.<\/p>\n

By <\/strong>Orbex<\/strong><\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Orbex Unlike most other countries, New Zealand does not publish it\u2019s consumer confidence data on a monthly basis. We only get that information once each quarter. So, in order to get a better view of the changes in consumer sentiment, analysts turn to proxies. These are other data sets that reflect how willing New […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-155089","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/155089","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=155089"}],"version-history":[{"count":3,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/155089\/revisions"}],"predecessor-version":[{"id":155095,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/155089\/revisions\/155095"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=155089"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=155089"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=155089"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}