Australia’s retailers are reportedly facing a huge crisis of sorts, with the latest data depicting a massive fall in sales volumes. As the nation’s second-largest state enforces a lockdown to fight the ongoing coronavirus, Australia’s retail sector seems to have suffered, what may be touted as its largest plunge in the past two decades.

As per sources familiar with the knowledge of the matter, data from the Australian Bureau of Statistics (ABS) depicted that retail sales adjusted for inflation fell 3.4% in the June quarter – its steepest slump ever since the introduction of the GST (goods and services tax) in 2000. Analysts had apparently been expecting a fall of 3.2% in the quarter. This humongous slump reportedly indicates that consumer spending is likely to be a drag on the GDP growth in the June quarter.

The sales drop apparently was driven by cafes & restaurants, falling 29.1%, while clothing, footwear and personal accessories, down by 22%. There were food retailing losses counted in as well.

Sources familiar with the knowledge of the matter claim that the drop in volumes is in complete contrast with the value-based retail figures, as June depicted a supposed 2.7% jump in monthly sales while May recorded a massive 16.9% rise as restaurants, pubs, and shops reopened in certain parts of Australia.

Economists warned that the retail sector dynamics will be clouded by the next wave of COVID-19 infections in Victoria, as the weekly expenditure data by the country’s major banks already exhibit signs of moderation. This week, the state of Victoria declared a “state of disaster” following a surge in coronavirus infections.

It is interesting to note that as opposed to retailers, Australia’s exporters have been going down a profitable route, perhaps due to the increase in the demand from China for iron ore and various other resources. Imports on the other hand have still been impacted by lockdowns.

Source Credits: https://in.reuters.com/article/australia-economy-salesfigures/australian-retailers-suffer-worst-quarter-in-two-decades-exports-shine-idINKCN250088