Electronic card spending in Palmerston North was down on the national average last month.
The city saw a 2.8 per cent increase in value spending for July compared to 2013, while national spending was up 6.1 per cent, Paymark data said.
Palmerston North City Council economic policy adviser Peter Crawford linked this to the slump in dairy prices. "The downturn in dairy prices just means people are a little careful about spending."
Palmerston North and the Manawatu District had a drop in accommodation spending in July while national data showed a big increase.
"That, plus the Fonterra announcement [cutting the dairy payout], will both be factors in the weak retail growth here."
Although spending traditionally increases during the school holidays, this year there was a regional increase of 9.4 per cent during the two-week period, well above previous years' figures, Paymark's head of customer relations Mark Spicer said.
Spending through the Paymark network in July increased in clothing outlets, footwear stores, appliance outlets and department stores, most likely a result of the late onset of wintry weather.
- Manawatu Standard
Will Aaron Cruden's omission hurt or help the All Blacks?Related story: Senior All Blacks 'pretty disappointed' in Cruden