According to MarketMatrix (MarketMatrix.net), retail sales hit another record high and have maintained growth for five consecutive months, indicating that consumers in Australia (AUS) remain resilient in an environment of rising inflation and interest rates. However, most economists expect the indicator's outlook to point to a decline.
The monthly retail sales report released by the Australian Bureau of Statistics (ABS) on Wednesday showed that in May, retail sales increased 0.9% month-on-month and 10.4% year-on-year to more than 34.2 billion Australian dollars. The previous four months increased by 1.6%, 1.8%, 1.6% and 0.9% respectively.
"Five of the six retail sectors grew in May as spending remained resilient," said Ben Dober, director of the indicator. "Higher prices drove growth in retail sales in May . This was most evident in cafes, restaurants, takeaway food services and food retail."
Retail sales rise for fifth consecutive month, hit record high_By Bloomberg
report It showed that department stores had the largest increase, up 5.1%; followed by cafes, restaurants and takeaway food services, up 1.8%; followed by others, up 1.5%, food up 0.6%, and household goods up 0.4%.
Clothing, footwear and personal accessories retail was the only category to decline, down 1.4%, after three consecutive months of growth.
"Households have so far managed to absorb the impact of rising inflation while not being spooked by rising mortgage rates," said Callum Pickering, economist at Indeed Hiring Lab. "This will give the Reserve Bank of Australia (RBA) some confidence in the economy's ability to withstand these turbulent times."
The Australian dollar rose after the data was released, then gave up some of its gains. At press time, the Australian dollar was trading at 69.12 cents against the US dollar. The benchmark 3-year Treasury yield climbed to 3.29%.
Economists' forecasts for RBA interest rate hike in July range from 0 to 65 basis points_By Bloomberg
While the numbers will bring some comfort to the RBA ahead of a second big rate hike in June It remains to be seen what impact the move to 0.85% will have on consumers. The central bank raised borrowing costs by 0.5 percentage points this month and signaled further interest rate hikes in the future, with money markets expecting rates to rise to 3.25% by the end of the year.
Pickering expects the Reserve Bank of Australia to significantly increase the cash rate for the rest of the year, including a 0.5 percentage point increase next Tuesday.
However, some economists worry that consumer spending, which has so far remained resilient, will take a hit in the face of soaring prices and a cooling housing market. Private consumption accounts for nearly 60% of Australia's A$2.1 trillion annual economic output.
"It may take several months to see the impact on retail sales data as consumers adjust their spending mix," said Diana Musina, senior economist at AMP Capital Investors. "Retail spending growth may now start to slow as consumers struggle with rising interest rates and high inflation."
---------------
Original address: http://www .marketmatrix.net/
---------------
Market Matrix: Research Center for Futures and Derivatives Trading- - From our selection Bloomberg /Reuters/CNBC/WSJ Look for your best trading opportunities in the information flow from top news sources! +++ Macro/stock index/crude oil/gold research reports and strategies from top investment banking institutions! +++ In-depth interpretation of economic data/industry reports!
+++ Follow +++ View all resources
