The Australian consumer is back! He, she, it, they have opened their wallets and went on a shopping binge.
This, at least, is what one would conclude after seeing the Australian Bureau of Statistics' (ABS) report revealing that retail sales surged by 1.2% in the month of November. This is more than double October's 0.5% increase and triple market expectations for a 0.4% gain. And oh, it's also the fastest single month increase since February 2013.
Not only that, the seasonally adjusted numbers show the annual growth in retail spending quickened to 2.9% from 1.8% in October and 1.6% in September.
But hold your horses. The ABS' media release explains the whys and wherefores for the sharp resurgence in retail spending, "Black Friday and iPhone X sales drive 1.2 per cent rise".
"In seasonally adjusted terms, rises were led by the household goods (4.5 per cent) and other retailing (2.2 per cent) industries ... Seasonally adjusted sales in both these industries are influenced by the release of the iPhone X and the increasing popularity of promotions in November, including Black Friday sales."
These are big adds considering that household goods retailing accounts for 18% of total retail sales while other retailing makes up 14% of the total.
My very rough calculations show that if the big jumps in household goods and other retailing were stripped out - or rather, assumed to have increase at the same monthly rate of 0.2% each in October - total retail sales would be just 0.2% higher for an annual growth rate of 1.8%.
This is consistent with the ABS' trend estimate that shows retail sales growth remains flat (0.1% in November from 0.1% in October) on a monthly basis and softer (1.7% from 1.8%) in year-on-year terms.
This is also consistent with other domestic indicators. While the Australian labour market is improving - the unemployment rate is at its lowest level since February 2013 (5.4%) - wage growth remains sluggish. The wage price index grew by 2.0% in the year to the September 2017 quarter, only a tad higher than the record low 1.9% increase recorded in the previous quarter.
What is more, household disposable income grew by only 1.8% in the year to the September quarter, just enough to offset the 1.8% increase in headline inflation over the same period for a grand total of zero growth in real disposable income.
But even if real disposable income were to become slightly positive, much of it would be spent on repaying rising household debt levels which, according to latest data, have grown to a fresh record high of 199.7% of disposable income in the third quarter of last year.
The good news is online sales are booming -- the ABS' experimental measure shows unadjusted growth of 22.3% in the month of November from 11.3% in October - and they could grow even more as consumers put to use their brand new iPhone Xs.
Ben Ong is the Director of Economics and Investments at Rainmaker Group. He previously worked as a portfolio manager and central banker before joining Rainmaker. Check out his economics analysis here.