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Otago was just in the top third of 17 regions across the country, booking a 7.4% increase in spending, up from $201.2 million in May last year to $216.1 million, according to Paymark's monthly electronic transaction report yesterday.
While Bay of Plenty had the largest percentage gain, up 10.2% to $270.9 million, the combined Auckland-Northland gain of 7.8% stood at $1.77 billion - more than triple its closest rival in Canterbury, at $500.6 million.
Paymark, the country's largest card processor, showed spending for May was up 8.3% from $4.03 billion a year ago to $4.37 billion, while separate data from Statistics New Zealand (SNZ) yesterday had the overall electronic spend for May up 1.3% at $6.2 billion, based on 121 million transactions.
The Reserve Bank is this morning expected to lift the official cash rate 0.25% to 3.25%, making it three rises in a row for interest rates.
New Zealand Institute of Economic Research principal economist Kirdan Lees said the domestic economy was strengthening and was taking more regions and industries along with it.
''More businesses are investing and hiring additional staff. Inflation pressures are building, but only slowly.
''Right now, interest rates need to move higher. But risks from the flying kiwi dollar, Auckland's housing market and a slowing Chinese economy mean future rate increases are less assured,'' Dr Lees said.
Economists for ASB and Westpac said May spending was ''stronger than expected'' and had ''bounced back strongly''.
ASB economist Christina Leung said the result reflected continued optimism among households, which she expected would continue to strengthen and support the economy growth during 2014.
''Population growth is likely to be a key driver of spending in this category [consumables] given the increased demand for necessities such as groceries,'' Ms Leung said.
Westpac economist Felix Delbruck said the SNZ figures bounced back even more strongly than the Paymark data suggested.
''The rebound supports our hunch that some of the weakness in card spending in April was due to the unusual confluence of Easter and Anzac Day holidays in the same week, which seems to have depressed a range of New Zealand activity indicators for April,'' he said.
SNZ's business indicators manager Neil Kelly said fuel and consumables had the largest rises in the retail industries. Fuel spending was up 2.8%, or by $21 million, while consumables were up 1.1%,or $18 million.
Paymark said the strongest growth was in the hospitality sector, at 14%, food and liquor stores up 12.3%, furniture stores up 11.3% and hardware stores up 10.7%.
From the Paymark data, the volume of transactions nationally was up by 8.7% to 89.4 million. Otago up 5.1%, but that gain was in the bottom four placings and well behind the more than 9% growth of Canterbury,Wairarapa, Hawkes Bay, Waikato and the Bay of Plenty's 10.4% gain.
At a glance
• Spending through Paymark up 8.3% annually.
• Retail spending, as measured by Statistics NZ, increased 1.3% in May.
• Spending increased in all six retail industries, the first time this has occurred since October 2013.
• Reserve Bank expected to increase official cash rate today.