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In-store retail spending in Auckland surged following the move to Alert Level 3, Stage 2.
The move to Alert Level 3, Stage 2 in Auckland has boosted retailing – but there is a warning stores are not out of the woods just yet.
The relaxed restrictions at Tāmaki Makaurau resulted in an immediate increase in in-store spending, with the number of credit card transactions increasing by 35% in the first five days in Stage 2, according to the Kiwibank Household Spending Tracker report.
The value of expenses also increased by 62 percent.
In total, the value of total credit card spending in Auckland increased by 14%.
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Department stores were the biggest winners from the change in restrictions, with the number of in-store credit card transactions increasing eightfold.
Spending inside clothing stores also increased, as well as at home improvement stores, with Tab 10 declaring potting mix as the most popular purchase.
There has also been an increase in home improvement and click-and-collect hardware purchases.
But the report said parts of the retail industry were still struggling.
Overall spending in Auckland is still down 2.2% from the pre-lockdown average as restrictions have continued.
But that’s a huge improvement from a 14% drop when he was at Level 3, Stage 1, according to the report.
Prime Minister Jacinda Ardern announces that Aucklanders will be free to leave the city from December 15 if they are vaccinated or have a negative test.
He said spending is expected to rise again once Auckland switches to the traffic light system and the border opens on December 15.
Kiwibank economists forecast a rebound in gross domestic product (GDP) of around 8.5% in the fourth quarter. But, with Auckland spending the entire month of October in some form of foreclosure, there was an increasing risk that the forecast would drop, they said.
“While our spending data and several leading indicators suggest that underlying demand is strong, Covid is still kicking things off for the economy, in the short term. As long as the blockages are part of the game plan, sharp fluctuations in economic activity are to be expected, ”the report said.