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MNI BRIEF: Aussie October Retail Sales Fall As Rate Hikes Bite

MNI (PERTH)
(MNI) Perth
True

The first decline in Australian retail sales this year has provided a hint that the Reserve Bank of Australia's aggressive rate hiking campaign and higher inflation may finally be hitting consumers. Retail sales fell 0.2% m/m in October, according to the Australian Bureau of Statistics, down from 0.6% m/m in September and falling shy of market expectations for a 0.5% increase, the first monthly decline since last December.

RBA governor Philip Lowe has cited household spending as one factor the Bank was watching closely. Given elevated inflation, a tight jobs market and rising wages, the data by itself is unlikely to shift expectations for another 25bp hike at the RBA's final meeting of the year on December 6. (See MNI BRIEF: RBA Set To Hike Again After Strong Jobs Data)

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The first decline in Australian retail sales this year has provided a hint that the Reserve Bank of Australia's aggressive rate hiking campaign and higher inflation may finally be hitting consumers. Retail sales fell 0.2% m/m in October, according to the Australian Bureau of Statistics, down from 0.6% m/m in September and falling shy of market expectations for a 0.5% increase, the first monthly decline since last December.

RBA governor Philip Lowe has cited household spending as one factor the Bank was watching closely. Given elevated inflation, a tight jobs market and rising wages, the data by itself is unlikely to shift expectations for another 25bp hike at the RBA's final meeting of the year on December 6. (See MNI BRIEF: RBA Set To Hike Again After Strong Jobs Data)

Keep reading...Show less