Retail Figures Show Strong Appetite for Discounting Among Consumers
Recent retail figures indicate a growing trend of discount-seeking behavior among shoppers, driven by inflation concerns and economic pressures.
Australia, Retail Sales, Inflation, Interest Rates, Consumer Spending
Canberra: Bargain-hunters are really stepping into the limelight after some promising inflation news. Analysts are now looking closely at retail sales data from the Australian Bureau of Statistics, which is set to drop on Thursday. This will give us a clearer picture of how consumers are behaving.
November’s retail numbers will include the Black Friday sales, which have been gaining traction over the years. An early start to discounting has already helped boost retail sales by 0.6 percent in October.
However, consumer spending overall has been a bit weak. This reflects a sluggish economy, with households feeling the pinch from rising mortgage payments and inflation.
ACTU president Michele O’Neil is calling on the Reserve Bank to start cutting interest rates in February. The Reserve Bank is keeping a close watch on consumer spending, as too much could complicate their efforts to manage inflation.
December’s inflation figures will be crucial for the RBA’s decision in February, but the early November numbers are looking promising. ANZ economist Catherine Birch noted that the trimmed mean inflation is tracking below the RBA’s expectations.
She mentioned that this raises the chances of a rate cut in February, although the strong job market will also play a big role in their decision-making.
A rate cut would be a welcome relief for Prime Minister Anthony Albanese, who has been traveling around the country ahead of the federal election, which is due by May at the latest. He’s been promoting his government’s efforts to ease the cost-of-living crisis without adding to inflation, like the revamped tax cuts and free TAFE places.
Meanwhile, the Australian Council of Trade Unions is pushing hard for interest rate relief. O’Neil emphasized that a strong job market shouldn’t delay necessary rate cuts, as spending on services is a small part of discretionary spending and isn’t driving inflation.
She concluded, saying there’s no time to waste—workers and their families need those interest rates to drop starting in February.