Electronic transactions tick up minimally in October

Thursday, 13 November 2025

Electronic retail spending increased just 0.2% in October - a worrying sign, says one of the country’s top economists.

The latest data from Stats NZ shows spending on the core retail industries increased by $10 million or 0.2% last month, when compared with the same time last year. That was less of an improvement in spending than had been expected.

The biggest increase in spending in the electronic card transactions data in the month of October was seen on consumables - food and groceries - up by $22m or 0.8%.

Spending on fuel was also up, by 0.5% or $2.5m.

Spending on all other retail categories during the month fell.

Spending on apparel was down by 0.6% or $1.9m, spending on hospitality and dining out was down 1.4% or by $21m, and spending on durables - items such as appliances and electronics - was down 0.1%.

Westpac NZ senior economist Satish Ranchhod said that was not a good sign, with all increases going on food - and fuelled by rising prices.

“The underlying detail of the October report points to disappointing momentum in household spending appetites,” Ranchhod told The Post.

“If we look at where spending has increased, it's almost entirely been in grocery food spending and with increases in food prices. That points to a lack of momentum in underlying spending.

“Discretionary spending areas like apparel, hospitality or spending on furnishings are actually down, and we’ve previously seen those categories pushing higher, but that momentum hasn't been sustained.”

Ranchhod said this would be “a disappointing result” for the Reserve Bank, which had been cutting interest rates for months and already delivered a large reduction in borrowing costs.

“We're more than a year into the easing cycle, and we're not seeing much momentum in household spending.”

Households and most consumers have remained cautious and unwilling to spend, which Ranchhod said likely reflected “softness” in the jobs market.

Retailers and businesses were hoping to see a quicker recovery than what has been delivered after more than a year of weak spending. However, Ranchhod said the data showed this was now unlikely, and rather a gradual recovery of spending appetites would occur slowly over time.

“With increasing numbers of borrowers rolling on to lower interest rates, I think we will see household spending appetites going into the Christmas shopping period, but it might be a gradual lift. Households are still cautious, given the state of the jobs market and the ongoing pressure on living costs.”

While year-on-year retail spending in October increased only 0.2%, actual retail card spending in October increased by 0.8%, below inflation at 3%.

Ranchhod and Retail NZ chief executive Carolyn Young said it was too soon to say whether this Christmas festive period would be strong for the economy.

“It's still a big struggle for a big portion of retail,” said Young.

“Inflation and prices in grocery have gone up. There's a lot of competition with fuel at the moment, electricity has gone up, rates are up. There's a lot of those core spending areas where inflationary factors have been taken into account.”

Young said retailers were hopefully retail spending would grow through November and December.

She said the data showed there were big areas of discretionary spend that were still struggling through October, categories that typically see more purchases over the festive and summer months.

“We need that to go up for Christmas. We have to see a big turnaround in November to get that [beneficial] platform for December.”