Retail Spending Uptick Persists in March

Retail spending growth continued to increase modestly in March compared to the same period last year, with the latest data from the Australian Bureau of Statistics (ABS) showing consumer spending during March 2025 at $37.3 billion, 4% higher than March 2024.

All categories were up year on year. The 'other retailing' category - which includes cosmetics, sports, and recreational goods - experienced the most significant increase (up 9.0% year-on-year), followed by clothing, footwear and accessories (5.0%). Spending in the categories of food, department stores and household goods all rose 4.0% over the past year. There was marginal growth in cafes, restaurants and takeaways, which increased by only 1.0%.

While the steady growth is heartening, cost-of-living pressures and economic uncertainty continues to impact consumer behaviour said Australian Retailers Association (ARA) Chief Industry Affairs Officer, Fleur Brown.

"This is another solid result during a challenging economic period. While hospitality growth was impacted by the change in Easter holiday timing, overall, it's encouraging to see another month of steady growth across most spending categories," said Ms. Brown.

"With a delay in interest rate relief, household budgets remain tight, and retailers are operating in a highly competitive and volatile environment with rising business costs. Any signs of stability in consumer spending are a welcome boost to business confidence, but we remain far from a retail recovery.

"Alongside the cost-of-living crisis, retailers continue to be impacted by years of rising costs - from rent and wages, to energy, insurance, transportation and all kinds of supply chain impacts.

National Retail Association Interim CEO Lindsay Carroll said retailers are beginning to see the sunny side up of spending after a few years of dreary sales.

"The March data is an encouraging sign that retailers are beginning to bounce back from strained spending and high business costs," Ms Carroll said.

"However, premature shop closures triggered by cyclone warnings undercut sales in parts of the nation, namely Queensland and New South Wales, at a time when every dollar counts for business owners.

"Events like these remind us how vulnerable the sector remains to sudden disruptions.

"Retailers need greater support to adapt quickly and safely during extreme weather events, without sacrificing their livelihood.

"Consumer confidence is showing early signs of recovery, we just need policymakers to help the sector keep up this momentum," she said.

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