Retail sales edged up in July but a weak jobs market and cooling real estate market could curtail consumer spending in coming months, MasterCard says.
MasterCard's SpendingPulse Report shows that retail trade rose by 0.7 per cent in July compared to June, and 3.6 per cent in the year to July.
Senior vice president of market insights Sarah Quinlan said it was the 65th consecutive month of growth in sales recorded by the report.
She said the change in season boosted sales, however sales growth noticeably slowed in the latter part of the month.
"Economic factors such as employment are weakening so we expect that it will be increasingly challenging to top sales growth going forward," Ms Quinlan told AAP.
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"The key is that there has also been a slowing in household goods spending as the real estate market has started to cool."
She also noted that department store sales, which fell 0.9 per cent in the month according to the Australian Bureau of Statistics, were only moderately positive in the MasterCard report.
"The challenge is that you have a working family and time is the most precious (thing) to them, and the department store is not meeting all their requirements, including store opening and closing hours," Ms Quinlan said.
She said there had been no visible impact on sales yet from the Reserve Bank's two rate cuts this year.
However, Ms Quinlan said rate cuts in general eased spending conditions.
