Retail sales have jumped by more than anticipated as discounting drew in shoppers and rising costs fuelled higher food-related spending.
The solid 0.7 per cent boost in May followed a flat result in April and a 0.4 per cent lift in March.
The Australian Bureau of Statistics said retail turnover had been supported by more spending on food and eating out, as well as a boost across non-essentials.
"This latest rise reflected some resilience in spending, with consumers taking advantage of larger-than-usual promotional activity and sales events for May," head of statistics Ben Dorber said.
He said cost-of-living pressures were likely pushing people to take advantage of sale events, much like they did during Black Friday in 2022.
Other retailing, which includes online-only retailers, florists and pharmaceutical and cosmetics retailers, recorded the largest rise over the month of 2.2 per cent.
The ABS chalked up this increase to an early start to end-of-financial-year discounting and the Click Frenzy Mayhem sales, as well as Mother's Day.
Household goods retailing lifted 0.6 per cent although the increase followed three straight months of declines.
Two other major discretionary categories fell over the month, with clothing, footwear, and personal accessories down 0.6 per cent and department stores falling 0.5 per cent.
It followed a boost in sales over April after colder-than-usual weather prompted consumers to splash out on warmer clothes.
Turnover lifted 1.4 per cent across cafes, restaurants and takeaway food services and 0.3 per cent for food retailing.
Mr Dorber said the uptick in food-related spending was largely a product of inflation, with the consumer price index revealing a 7.9 per cent lift in food prices in the 12 months to May.
Oxford Economics Australia head of macroeconomic forecasting Sean Langcake said the heightened spending at sales would be a short-term win for retailers but sales would likely be weaker next month.
He said the Reserve Bank would likely recognise the temporary nature of the May uplift, with household spending generally trending down as high inflation and rising interest rates cut into budgets.
"The data is unlikely to move the needle for the RBA and we still expect to see two more rate hikes in the coming months."
The RBA will also be weighing up weaker-than-expected inflation for May ahead of Tuesday's cash rate decision.
The monthly consumer price index lifted 5.6 per cent in the year to May, down sharply from 6.8 per cent in April.
The ABS also released job vacancy data on Thursday that revealed a two per cent fall between February and May.
While job vacancy numbers fell 9000 from February, they were still 89 per cent higher in May 2023 than in February 2020, just before the pandemic kicked off.
