In welcome news for retailers and consumers, the Reserve Bank of Australia this week held interest rates at 4.1%, for the second consecutive month.
We welcome this further pause of the cash rate, which we hope bolsters falling consumer and business confidence.
It coincides with data by the Australian Bureau of Statistics last week revealing the annual rate of headline inflation fell to 6 per cent in June, down from 7.8 per cent in the December quarter.
It suggests that inflation has peaked, so it is important the RBA carefully considers the repercussions of interest rate increases on Australian mortgage holders and businesses in future monetary decisions.
The impact of interest rate rises and the cost-of-living crisis has been profound, causing a slowdown in discretionary spending.
This was highlighted in the monthly retail trade data for June released on Friday, which saw most categories have entered decline.
A consistent theme this year, food and restaurant/takeaway spending showed year-on-year growth – while household goods has remained in negative growth for more than six months.
However, in June, department stores (down 2.1%), clothing, footwear and accessories (down 1.5%) and other retailing (down 1.1%) suffered downturns.
In other news, after many months of focused work to establish the government’s new industry skills and training entity, the ARA is proud to have appointed an inaugural CEO of SkillsEQuipped, which you can read about here.
