Australia retail sales flat as consumers cut back on food

SYDNEY, May 28 (Reuters): Australian retail sales were flat in April as consumers, who face high living costs and rising interest rates, cut back spending on food and dining out, bolstering the case for a pause in rate hikes next month.
Data from the Australian Bureau of Statistics (ABS) on Friday showed retail sales were unchanged in April from March, when they rose 0.4 per cent. Analysts had looked for 0.2 per cent growth.
Sales of A$35.26 billion ($23.92 billion) were up 4.2 per cent from a year earlier, slowing from the 5.4 per cent growth in March.
While shoppers spent more on winter clothes and in department stores, they curbed spending on food and dining out, which registered declines of 0.1 per cent and 0.2 per cent respectively.
The slowdown in consumer spending is evidence that a whopping 375 basis-point tightening by the Reserve Bank of Australia since May is having the desired effect of cooling demand.
"Retail turnover has plateaued over the last six months as consumers spent less on discretionary goods in response to cost-of-living pressures and rising interest rates," said Ben Dorber, ABS head of retail statistics.