Australia's Housing Bust Impacts Retail Sales, Recession Coming Up

Australia's housing bust now impacting retail sales. Except for food, retail spending has been negative for 3 months.

In Australia, Falling Home Prices Now Hitting Retail Sales.

> If retailers were not in enough strife already, it now appears falling house prices have joined low wage and price growth, as well as declining household savings, in their increasingly large list of worries.

> Monthly retail sales figures have disappointed again, rising just 0.2 per cent in September on a seasonally adjusted basis.

> More disturbingly, sales were up just 0.2 per cent across the three months of the September quarter.

> With the exception of cafes, restaurants and takeaway, the other key discretionary sectors such as household goods, clothing and department stores reported either flat or negligible sales growth.

> "The subdued rise in real retail sales in Q3 suggests that households are starting to feel the pinch from rising petrol prices and the slowdown in the property market," Capital Economics analyst Marcel Thieliant said.

Recession Coming Up

A recession cannot be far off. It's likely to be a lengthy one as the burden of debt and rising mortgage payments takes an even bigger bite out of Australia's economy.

Mike "Mish" Shedlock

Comments (7)
No. 1-4
Blurtman
Blurtman

Their 10 year treasury rate is lower than the USA’s.

Casual_Observer
Casual_Observer

The world excluding the US is in recession. Australia is now a Chinese dependent economy.

Realist
Realist

Hi Casual. The Chinese economy is growing at 6.5% Australia 3.4%. How is that a recession?

Casual_Observer
Casual_Observer

The China numbers are state created. The all country world market index has been signaling world recession since the January 2018 high. In the aggregate global markets excluding the US have been negative for months. We will see it in Q1 of 2019 when full year numbers get restated.