Published September 8 2021
Retail spending in Melbourne has continued to decline amid ongoing movement restrictions, but a strong post-lockdown redound is still likely, according to ANZ Senior Economist Adelaide Timbrell.
ANZ data show average weekly spending across inner Melbourne fell 58 per cent in the week to September 3, compared to the last full week before the recent Melbourne lockdowns - the seven days to May 22.
The rest of Melbourne (outside the City of Melbourne municipality) fell just 34 per cent in the same period.
Timbrell said city spending had been impacted by orders preventing workers from commuting to the central-business district – a factor which may not entirely subside when lockdowns are lifted.
“As work-from-home continues past lockdowns, we expect to see more economic activity and spending in suburbs and regional areas, and less in the CBD compared with pre-pandemic conditions,” she said.
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Despite the decline, Timbrell said ongoing fiscal support, a resilient labour market and improving consumer confidence should combine toward a bounce in spending once lockdowns are lifted.
“We expect weakness in spending across Australia’s east coast to continue until lockdowns ease, but once retail reopens in Melbourne and New South Wales, a strong rebound is likely,” she said.
In regional Victoria, ANZ data show average weekly spending slipped 31 per cent compared to pre-lockdown times, but recently announced relaxations would lead to a solid rebound, according to Timbrell.
However, “a full recovery of spending in regional Victoria – particularly travel-related spending – relies on travel between Melbourne and regional Victoria,” she said.
Recent lockdowns across Australia has seen major declines in inner-city spending, including in Sydney and Adelaide. Spending in Melbourne had been slowly returning before the fifth lockdown put an end to that recovery.
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