WA spends up on electronics in June but EOFY sales may just be a one-off retail sugar hit
West Australians spent up on mobile phones, computers and white goods during the mid-year clearance discount season, with Bankwest's latest report showing transaction volume for electric appliances surged 21 per cent month-on-month in June.
The bank's monthly analysis crunches the numbers on WA customer credit and debit activity to spot responses to fluctuating economic conditions.
Bankwest Curtin Economics Centre director Alan Duncan said cost-conscious shoppers tend to be interested in big-ticket items, like white goods, during any promotional events, whether that's EOFY, Black Friday or Boxing Day sales.
'The quantum of saving appears to be much greater, so if you're spending $1000 rather than $1500 or $2000 on an electrical appliance then of course that's going to seem relatively attractive,' he said.
But Professor Duncan said it was too early to tell if the bank data showed a broad recovery in consumer spending, pointing to the slight 2 per cent growth in transaction value in June.
'You are seeing a shift towards appliances, recreation and department stores, but a shift away from other consumptions and I think for that reason it's not necessarily that there is a net substantial increase in spending,' he said.
'You do see people being aware of potential value in sales items and going for those, but then maybe moderating what they spend in other months of the year.
'There are also some risks on the horizon, particularly if . . . rents continue to grow.'
Recreation and department stores recorded a 14 per cent and 11 per cent growth in transaction volume, respectively, in June. Discount stores and other services, like courier services and roadside assistance companies, posted a 4 per cent decline.
It comes as recent data from property listings platform Domain earlier this month revealed Perth house rents lifted 0.7 per cent, or $5, to a fresh high of $700 a week in the June quarter.
Professor Duncan said a weekly rent of $700 would eat up about 62 per cent of the average single person's $1125 disposable income — more than double the threshold that constitutes mortgage stress.
Local business owner Frank Beverwijk said sales for computers, laptops and accessories at his Arrow Computers was 'okay' in June and that it had picked up from prior months.
Asked if further interest rate cuts would encourage more spending among his customers, Mr Beverwijk: 'Absolutely'.
'Everyone is in survival mode so that would be the case,' he said.
'When the mortgage rates are sky-high even small businesses . . . are very worried about borrowing money to either make money or (just) to have spare cash around.'
Investors have upped their bets on an August rate cut after recent data showed Australia's jobs boom stalled in June.
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