Rates, jobs encouraging spending

Low interest rates, a pick-up in jobs growth and a strong lift in new home building are all helping to support retail spending.

News figures suggest buoyant shopping is likely to extend into at least the next three months.

The Australian Food and Grocery Council-CHEP retail index was 4.3 per cent higher in the June quarter compared to a year earlier.

Based on pallet movements of logistics company CHEP Australia, the index is a lead indicator for retail sales growth and is expected to rise to 4.6 per cent growth in the September quarter.

"It's encouraging to see low interest rates and a pick-up in jobs growth flowing through to stronger retail sales," AFGC CEO Gary Dawson said on Tuesday.

Household goods retailing continues to be the strongest performing retail sector, aided by new home building, while food retailing is the slowest sector.

"But at four per cent or better, (it) remains strong despite softening population growth and is likely to continue to benefit from improved confidence and ongoing low interest rates," Mr Dawson said.