Spending in Melbourne kicked off its post-lockdown recovery in style, ANZ data show, driven by a spike in shopping spending as the state of Victoria lifted pandemic-related movement restrictions in stages.
And it isn’t a matter of “switching” spending habits, according to ANZ Senior Economist Adelaide Timbrell, who noted home-related spending such as furniture rose sharply alongside increases in social categories like dining and fashion.
Spending in the City of Melbourne on the weekend of October 29 to 31 was just 8 per cent lower than the comparable pre-lockdown period of May 21 to 23, ANZ data showed – a significant improvement on the weekend of October 22 to 24, when spending was 61 per cent lower than pre-lockdown.
“The second stage of the reopening had a much bigger impact on spending than the first,” Timbrell said. “The reopening of non-essential retail led to a 125 per cent increase in non-food retailing spending, and took shopping spending to 6 per cent above pre-lockdown levels.“
“Although most products in this category were available through online shopping channels during lockdown, access to bricks and mortar retail proved critical to the retail recovery.”
Timbrell noted rises were yet to be seen across sectors such as entertainment and travel, but expected that to change as consumers began making post-lockdown plans.
“We expect travel and entertainment spending will continue to recover as businesses and households are given time to plan events and holidays, and as the risk of iterative state border closures fall,” she said.
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The data showed fashion spending rose 357 per cent between October 29 to 31, compared to the last weekend in lockdown between October 22 to 24.
Jewellery spending jumped 46 per cent above the pre-lockdown weekend of May 21 and 23, while furniture spending rose 21 per cent in the same period.
“The lifts across both social retail spending (fashion, jewellery) and home-related spending shows that bricks and mortar retail access lifted total spending, rather than moving spending from home-related items to social items,” Timbrell told ANZ Institutional Insights.
As seen in many metropolitan areas, the popularity of working from home continues to hold back spending in the City of Melbourne compared to other suburbs, Timbrell said.
“Middle and outer suburb spending has seemed to recover more quickly, as more people either avoid the city or shop closer to their home rather than their workplace," she said.
“The bigger exposure of inner Melbourne to entertainment spending has also slowed its recovery compared to suburban areas.”
The spike in Melbourne comes after spending in metropolitan Sydney suburbs, excluding the CBD, rose 5 per cent in the week of October 11, compared to the last week pre-lockdown of June 7.
Head of Diversified Industries at ANZ Institutional, Sara McCluskey, said the data would provide confidence to businesses that have dealt with ongoing lockdowns across the state of Victoria.
“As a proud Melburnian, I am thrilled to see our city coming back to life,” she said.
“At ANZ, we work closely with our customers to ensure they can utilise our data in a meaningful way. The return to movement in our cities provides opportunity to track new patterns of consumer spending.”
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