Retail sales go from strength to strength

Retail sales increased by 0.9% seasonally adjusted in July, exceeding market expectations of a 0.6% rise and again reinforcing the fundamental strength of the Australian economy.

Department stores led the way with a big 5.7% gain in June, while recreational goods and clothing also performed strongly, with 2.3% and 1% lifts respectively. Household goods retailing was the main industry group to decline, losing 0.7% after a 1.2% rise in May.

The economic confidence that prevailed in July, before the international financial crisis hit, is also reflected in a 0.9% increase in credit growth in July. Business borrowing was by far the biggest area of credit growth, picking up by 1.4% on top of June’s 2% increase – all eyes will now be on the August figures to see what impact international volatility has had on business and consumer sentiment.

And in company results, media and entertainment company Destra yesterday announced a remarkable 438% increase in revenue to $66.8 million for the 2006/2007 financial year.

According to The Australian Financial Review, Destra announced a $200,000 profit, which Destra chief executive Domenic Carosa says was driven by the businesses switch from web hosting to media content. Have a look at SmartCompany’s Lunch with an Entrepreneur with Carosa to read more on how he achieved Destra’s tremendous growth.

At 12.45pm today The S&P/ASX 200 is up 0.6% to 6168.8 points and the Australian dollar is trading at US81.78c, up on yesterday’s US81.55c close.

Mike Preston