By Aimee Chanthadavong

In the lead up to the federal election this Saturday, signs of nervousness are more obvious than ever as consumers continue to spend cautiously, which is reflective of the latest Australian Bureau of Statistics Retail Trade Figures.

The retail trade turnover only rose 0.1 per cent in July following an unchanged June 2013.

The rise was largely affected by falls in department stores (-7.9 per cent) and other retailing (-0.2 per cent).

Australian National Retailers Association’s chief executive Margy Osmond said the noticeable drop in department stores was due to their continued approach with mid-year sales promotions, which has transitioned in recent years from less traditional approaches to spreading the sales period over a number of months.

“There’s no reason for retailers to panic just yet, over a three month period in June, July and August last year department stores recorded an increase in sales,” she said.

However, this was partially offset by increases in household goods retailing (1.8 per cent) followed by food retailing (0.5 per cent), clothing, footwear and personal accessory retailing (1.4 per cent) and cafes, restaurants and takeaway food services (0.1 per cent).

National Retail Association chief executive Trevor Evans said a stable government is needed to counteract continued soft retail sales.

“Consumer confidence is still low as households respond to the uncertainty caused by this long election campaign,” he said.

“Shoppers are clearly sitting on their wallets and their purses while they wait for a stable, longer term plan for the economy, and this can be seen with the flat retail trade figures.”

On a state by state basis, the largest contributor to the rise was the Northern Territory (3.1 per cent), South Australia (1.6 per cent), Tasmania (1.5 per cent), the Australian Capital Territory (0.3 per cent) and Victoria (0.2 per cent).

Weaker results were seen in Western Australia (-0.7 per cent), New South Wales (-0.1 per cent) and Queensland (-0.2 per cent). Over the longer term, New South Wales is the largest contributor to the weakness (down 0.2 per cent in trend terms).

Australian Retailers Association executive director Russell Zimmerman said it is now up to the winning party this election to give some breathing room for retailers.

“It’s clear that recent political instability has affected consumers spending habits,” he said.

“With less than one week to go until the Federal election, the ARA has every hope that with a majority Government, retailers will be able to enjoy a boost in sales toward the end of the year and a promising start to 2014.

"Consumers and businesses need a strong and stable government with pro-business consistent policies in order to allow consumers to regain the confidence to spend.”