Written by James Glenn
SYDNEY – Australian retail volumes posted a 3rd consecutive quarterly decline within the second quarter, underlining that buyers are curbing spending in response to rising prices of residing and an enormous leap in rates of interest.
The prolonged decline follows the RBA’s report 400 foundation level rise in official liquidity since Could final 12 months, because it labored to stamp out the largest spike in inflation in additional than three a long time.
Retail gross sales volumes fell 0.5% within the second quarter. This adopted a 0.8% decline within the first quarter and a 0.4% decline within the fourth quarter of final 12 months, the Australian Bureau of Statistics reported Thursday.
ABS stated this was the primary time since 2008 that retail gross sales volumes had posted three consecutive quarterly declines.
The decline in demand throughout the economic system helps the Reserve Financial institution of Australia’s determination this month to increase a pause in rate of interest hikes for the second month in a row. Extra economists at the moment are saying the RBA is completed elevating rates of interest, with cuts to observe in late 2024.
Retail gross sales volumes additionally decreased by 1.4% in comparison with the second quarter of final 12 months. Exterior the pandemic interval, ABS stated, that is the primary time since 1991 that gross sales quantity has fallen in comparison with the earlier 12 months.
Then again, as inflation picked up throughout the economic system, retail costs rose 0.9% within the quarter, up from 0.7% within the first quarter.
Cafes, eating places and takeaway service gross sales fell for the primary time for the reason that Covid-19 Delta shutdown in September 2021. Retail gross sales volumes for family items and supermarkets additionally fell sharply.
“The broad decline in gross sales quantity displays what retailers have been telling us about customers specializing in necessities, shopping for much less, or switching to cheaper manufacturers,” ABS stated in a press release.
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