Slower spending expected in early 2015

Retail spending is expected to slow during the first few months of 2015 after the strong Christmas trading period.

The Australian Food & Grocery Council-CHEP retail index was just 2.4 per cent higher for the March quarter compared to a year earlier, almost half the 4.4 per cent rate in the previous three months.

The council's chief executive Gary Dawson said while a lower Australian dollar has been positive for food and grocery exporters, the domestic market remains tough for manufacturers.

This is due to below average consumer sentiment and the highest unemployment rate in more than a decade.

"Manufacturers and retailers will be hoping the fall in oil prices and low interest rates are sustained, leading to improved consumer confidence in 2015," he said on Thursday.