New Zealand Retail Sales for June 2010

[22:55 NZ ECON:  Retail Trade Surprises Sharply To Upside In June, Q2] SYDNEY, Aug 13 (IFR) - Retail trade in New Zealand has been barely rising for months, and markets and IFR and looked for more of the same in June, but instead growth soared over both the month and the quarter.  Overall retail trade leaped 0.9% in June, the strongest rise since last August, against market expectations of a 0.4% rise.  Ex-car sales bounced a hefty 1.5%, their best result since last May and also more than double the 0.6% expectation.  Helped by this bounce in June, retail trade volume rose 1.3% over the June, handily beating expectations of a second straight quarterly gain of just 0.2%.  With nominal retail trade rising a mere 0.5%, the rise in volumes reflects heavy discounting by retailers, suggesting that underlying demand remains relatively weak.  While IFR had been thinking that weak retail data combined with the greater uncertainty in major economies would argue against another rate hike in September, the relatively hawkish central bank is likely to take this as a sign that domestic conditions are improving and make the market expectation for another 25bp more likely.  Further details and table on .  George.Worthington@thomsonreuters.com