Retail sales smash expectations (again): 3mth average = 6% pa

Another awkward moment for the domestic economy doomsayers (or so-called "doves"). No retail recession. No below-trend consumer spending. Indeed, no below-trend growth. The more limited monthly retail trade survey released by the ABS today has again printed above analyst expectations: 0.5% in the month of May (s.a.) compared with an average forecast of just 0.2%. On a three month moving average basis retail trade is growing at an above-trend 6% pa pace (see chart).

Recall that the quarterly ABS National Accounts consumer spending data is much wider than the monthly ABS retail survey, which only captures about one-third of total consumption. The former implied above-trend consumer spending in the first quarter of 2012, which the chart above confirms.  

Strong private business credit, recovering house prices, above-trend retail spending, and better building approvals. All partial indicators that the RBA's multiple "insurance" rate cuts are having an impact...Or were perhaps not required in the first place.