New Zealand’s retail sector has yet to come out of adverse impact of global financial crisis, as indicated by retail sales figures for July. The country witnessed fall in retail sales for the second successive month in July, apparently due to low demand across the segment.

The development backs Central Bank’s stance over slow and patchy economic recovery, which has been undergoing record-low interest rate regime. Retail sales in the country witnessed 0.5 per cent decline, the sharpest ever fall since January, indicating weak position of department-store and supermarkets.

This fall in sales is contrary to Reuters’ projections of 0.5 per cent rise in retail sales in July amid recovering economy. However, vehicle segment did slightly better, reporting an increase of 2.1 per cent, or $11m in sales.

Core sales, as per data released by Statistics New Zealand (SNZ), too fell 0.5 per cent in the reporting period, against Reuter’s forecasts of 0.6 per cent rise in sales.

Senior economist at Westpac, Mr. Doug Steel said: 'They've been looking for the consumer to be relatively weak for an extended period, and even though it's a monthly volatile series, it backs up that view.'