Retail spending/per capita
Coming back to a graph that Indeed’s Australian economist Cal Pickering posted recently.
It shows that retail trade has indeed been supported by population growth. That’s a part of it. But mostly it is just price.
And if it is just price, well, price rises can moderate. And if volume growth is all that’s left, and it is weak, then the outlook for retailers should be more challenged.
And if rates are rising in the background, it should impact that dynamic all the more.
Anyway, it is part of why we are underweight the consumer discretionary names.
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