Retail spending increased by 0.7% in July, following revised increases of 0.4% in both June and May, according to the latest figures from the Australian Bureau of Statistics.
The biggest increase was in cafes, restaurants and takeaway food services, which recorded a 1.5% increase in sales, followed by food retailing at 0.4%, clothing, footwear and personal accessory retailing at 0.4% and other retailing at 0.4%.
Department store retail turnover decreased by 0.4% during July. Victoria and New South Wales recorded the highest increases at 0.8% and 0.6% respectively, while Western Australian, Tasmania and the Australian Capital Territory all recorded declines.
Meanwhile, the ABS also reported a seasonally adjusted current account deficit of $5.64 billion in the June quarter, down from a revised deficit of $16.457 billion in the March quarter.
The ABS said the decrease of $1.26 billion in the deficit in chain volume terms would contribute 0.4 percentage points to growth. It also said net foreign debt increased by 2% to $671.8 billion in the June quarter, while It was at $624.2 billion in the same period during 2009.
The Bureau also said building approvals increased by a seasonally adjusted 2.3% in July, with a total of 13,732 buildings given approval, the first increase in three months.
The result comes after a Reuters poll indicated economists predicted a 0.7% decline in building approvals.
“Both (retail and building) are potential indications that some of the dead weight from rapid-fire rate rises earlier this year is starting to ease up,” Commonwealth Banking Group chief economist Micheal Blythe told Reuters.
“I think we are a long way from that (rate cut) nor is there enough here to say (that there will be) imminent rate rises either. There is plenty of information to come tomorrow, and the next month or two will be more important for that interest-rate story.”
Centro Properties Group has recorded a loss of $652.7 million during the year to 30 June, but notes this is an improvement from the $3.54 billion loss recorded during the previous corresponding period.
The company said the improvement was due to lower property valuations and the impact of the strong Australian dollar. Chief executive Robert Tsenin said the company at $18.6 billion in investment properties and $18.4 billion debt.
“This is clearly an unsustainable capital structure,” he said in a statement. “Any restructure will be complex and must be critically linked to reducing the leverage and financial risks confronting us.”
“Subject to market conditions, it is expected that any restructure could take through to the end of 2011 to implement.”
The local sharemarket has opened lower this morning, following a disappointing night on Wall Street where investors are still worried about the prospects of the American economic recovery.
The benchmark S&P/ASX200 index was down 24 points or 0.54% to 4428.5 at 12.25 AEST, while the Australian dollar opened lower at US89c.
NAB shares lost 0.8% to $23.36, while ANZ also lost 0.7% to $22.80. Westpac fell 1.3% to $22.04 as AMP fell 1% to $5.04.
Airline giant Qantas has said its passenger numbers increased by 9.1% in July, with revenue seat factor falling to 82.5%, down by 0.4%.
Total domestic yield was 1.3% lower than in 2009, with total international yield increasing by 11.4%. The company said it has hedged 56% of its remaining fuel requirement for the rest of the year at a worst-case scenario of $US87.80 per barrel.
In North America, mining giant BHP Billiton has denied speculation it will sell any of Potash’s assets of it succeeds with its $US38.6 billion bid.
“At this stage BHP Billiton has no plans to sell any Potash Corp assets. Our offer is for the whole company, including the phosphate and nitrogen businesses,” a BHP spokesman told Reuters.
Back home, RiverCity Motorway Management has posted a $1.67 billion loss for the year to 30 June, saying it is facing serious financial concerns. The company operates the Brisbane Clem 7 toll road.
“While traffic volumes have increased since opening, current traffic will need to improve markedly over the coming months for the group to be in a position to meet its ongoing financial obligations after its existing cash reserves are utilised,” chairman Robert Morris said in a statement.
“The current situation is serious, but it is very early days in the life of our 41-year concession…The board and management will continue to focus on building traffic volumes over the coming months.
Japanese factory output increased during July, but that data was overshadowed by other figures showing manufacturing activity expanded at its slowest pace in over a year.
“Japan’s economy isn’t worsening but the pace of recovery is clearly slowing. We will likely see output growth slow significantly, particularly in the fourth quarter when the effects of the yen’s rise start to appear in full,” Norinchukin Research Institute chief economist Takeshi Minami said in a statement.
“If the economy is performing as it is, the Bank of Japan will continue to come under pressure to ease monetary policy further.”
Worries over economic recovery are also on the table in the United States, where president Obama says he is discussing ways to help assist small businesses and grow the economy. .
“My economic team is hard at work in identifying additional measures that could make a difference in both promoting growth and hiring in the short term and increasing our economy’s competitiveness in the long term,” he said in a statement.
He said he is considering “further tax cuts to encourage businesses to put their capital to work creating jobs here in the United States.”
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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