Statistics New Zealand figures released yesterday showed spending on electronic cards rose strongly last month, led by the biggest monthly gain in hospitality expenditure since November as the sector continued to enjoy the benefits of an expanding population and booming tourism numbers.
Retail spending rose a seasonally adjusted 0.3% in July, slowing from the 1.2% increase in June, Statistics New Zealand said.
However, spending on hospitality was up 2.9% in July, the largest area of increase.
ASB senior economist Jane Turner said with ongoing tourism growth, low interest rates and migration showing little sign of slowing, spending was expected to remain healthy this year.
Spending on fuel fell 3.6% as cheap oil continued to reduce costs for motorists. Core retail spending, which excluded vehicle-related items, was up 0.7% in the month.
''People spent more on accommodation and on food and drinks in restaurants and takeaway shops,'' SNZ business indicators senior manager Neil Kelly said in a statement.
''In contrast, they spent less on fuel, with petrol prices falling about 10c a litre in July.''
Ms Turner said that, on average, petrol prices fell 5.2% in July and that was reflected in the 3.6% fall in fuel spending.
''With consumers having more money left in their pockets after filling up at the pump, this could help explain some of the strength in other categories in July.''
The hospitality sector had been reaping the benefits of New Zealand's prolonged tourism boom at the same time as record net migration numbers have boosted the population.
Yesterday's data showed electronic card spending on hospitality in July was 18% higher than a year earlier at $925 million. Core retail spending was up 8.3% at $4.11 billion in July from a year earlier.
Expenditure on consumable goods rose 5.5% to $1.74 billion, durables items was up 6.5% to $1.15 billion, and apparel spending grew 5.1% to $291 billion.
By contrast, credit and debit card spending on fuel dropped 8.6% to $571 million. Spending on vehicles rose 4.7% to $161million from a year earlier, and total retail spending increased 5.8% to $4.84 billion.
Including services and non-retail industries, spending on electronic cards increased 4.5% to $6.53 billion in July from the same month a year earlier.
The number of transactions across all industries rose 7.7% to 134 million, while core retail sales transactions were up 8.2% to 99 million from July 2015. The average value per transaction was $49.
