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MNI BRIEF: Aust Retail Sales Resilient Despite RBA Hikes

MNI (PERTH)
MNI (Perth)
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The Reserve Bank of Australia's five consecutive rate hikes have yet to be fully felt by consumers as August retail sales rose a better-than-expected 0.6%, highlighting the resilience of household spending. While the August data slowed from the 1.3% pace recorded in July, it was the eighth consecutive monthly rise and lifted y/y retail sales growth to 19.2%, the Australian Bureau of Statistics said - the highest since April 2021.

The RBA, which meets next Tuesday, has cited household spending behaviour as an "important source of uncertainty" given consumer sentiment gauges are hovering near recessionary levels and the full impact of 225bps of hikes since May are yet to be reflected in mortgage interest rates. However, the jobs market remains tight and wages are rising. Expectations have firmed for another 50bps hike at next week's meeting.

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The Reserve Bank of Australia's five consecutive rate hikes have yet to be fully felt by consumers as August retail sales rose a better-than-expected 0.6%, highlighting the resilience of household spending. While the August data slowed from the 1.3% pace recorded in July, it was the eighth consecutive monthly rise and lifted y/y retail sales growth to 19.2%, the Australian Bureau of Statistics said - the highest since April 2021.

The RBA, which meets next Tuesday, has cited household spending behaviour as an "important source of uncertainty" given consumer sentiment gauges are hovering near recessionary levels and the full impact of 225bps of hikes since May are yet to be reflected in mortgage interest rates. However, the jobs market remains tight and wages are rising. Expectations have firmed for another 50bps hike at next week's meeting.

Keep reading...Show less