Tasmania has recorded the strongest result in the country in the CommSec Business Sales Index.

The index records credit and debit card transactions across all areas of the economy and is considered an important lead indicator for retail trade.

Sales in Tasmania grew by 0.8 per cent in September, which was the equal highest result with South Australia.

Queensland recorded only a 0.2 per cent rise, Victoria was up 0.1 per cent, sales were flat in WA and NSW recorded a fall of 0.3 per cent.

The Premier, Lara Giddings, cautiously welcomed the results as an indication that recent interest rate cuts are beginning to have a positive effect on consumer spending.

"There is no denying that times are incredibly tough in the retail sector at the moment," Ms Giddings said.

"Household savings levels are at an all-time high and online shopping is also having an impact on traditional stores.

"That is why is it so important to build confidence and encourage consumers to start spending again.

"These results are a sign that recent interest rate cuts are starting to have the intended effect of stimulating consumer spending.

"Confirmation this week that GST receipts are growing again for the first time in 2 years is further evidence that consumers are beginning to spend again." 

Ms Giddings challenged the Liberal Party to acknowledge the positive signs of retail recovery.

"The Liberals have been quick to seize on recent reports highlighting Tasmania's economic challenges. 

"However, they have a shameful habit of ignoring positive news and actively working to trample signs of confidence.

"Any small business owner knows that is foolish to talk down their business, so why is the Liberal Party so insistent on talking down Tasmania?"