Small business sales drop
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Small business sales underperformed in the second quarter of the year, with weakness concentrated in the North Island.
The latest Xero Small Business Insights indicates sales fell 0.1 percent in the three months ended June over the year earlier, which was consistent with the downturn seen over the the past 12 months.
The latest sales data was tracking under the long term average of 6.3 percent growth, and well below the 3 percent growth seen in Australia over the second quarter.
However, the month of June was the best since April 2024, with sales up 4.4 percent.
The agricultural sector was another bright spot with a 11 percent increase in sales in the June quarter, making it the third quarter in a row for double digit growth.
However, Xero country manager Bridget Snelling said the resilience of the agricultural sector was not enough to offset weakness elsewhere, with the construction sector hit particularly hard with a 6.4 percent drop in sales.
She said the sector's sales had been falling since late 2023, with retail and manufacturing sales also down.
"Despite consistent OCR (official cash rate) cuts by the Reserve Bank since August 2024, we're yet to see the expected boost to consumer and business activity.
"While there are some bright spots like agriculture, the overall picture remains muted."
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