[Sydney 4th Reuters]-Australian Federal Statistical Office announced August retail sales rose 0.4% month-on-month, the first high growth in 6 months.
This suggests that recent cuts in interest rates and tax refunds by the Australian central bank have helped boost consumer spending. However, the push-up seems limited.
The analyst expectation was down 0.5% Retail sales in July were flat.
NAB economist Kaixin Owyong said in a report: “A positive recovery in retail sales is welcome, but the tax refund that started in July has confirmed that it is actually boosting retail sales. “I ca n’t, and it ’s suggesting that consumer spending is facing significant headwinds.”
The Reserve Bank of Australia (RBA, Central Bank) has cut its official interest rate cash rate from 1.00% to 0.75% this week. This is the third time since the beginning of the year that interest rates will be reduced by supporting the economy and reducing the unemployment rate. A policy to further ease monetary policy as needed was presented.
The central bank's President Roh has repeatedly expressed his view that the biggest uncertainty in the country is the outlook for consumption, and that a small increase in household disposable income is a burden of spending.
“For RBA, these statistics support the vendor's indication that the retail industry will remain sluggish,” Owyong added, suggesting that further stimulus is needed to increase consumer spending.