Australian Retail Sales Keep On Subdued - RBA Meets

The Reserve Bank of Australia holds its April policy meeting and while economists doubt it will cut the 4.25 percent cash rate this time.

New York, NY (prHWY.com) April 24, 2012 - The menclothing recently reported that, the Australian retail sales rise at a snail's pace in the month of February as customers spent less on clothing, eating out and household goods, a long-running trend which will only include to industry calls for an additional cut in the interest rates.

The RBA (Reserve Bank of Australia) holds in its April policy conference in the recent times as well as while economists hesitation it will cut the 4.25 % cash rate at this time, most of the people predict an easing to 4.0 % come in May.

A senior economist at Macquarie, Brian Redican said that, the figures illustrate sales are presently dribbling alongside, as they have been for 6 months now, therefore there is no big surprise there.

As per the public statements of RBA, they don't observe any urgency to ease at present, although we do see a greater possibility of a move in the month of May after the inflation figures are out.
Major data on inflation for the initial quarter are due on 24th April and are usually predicted to show value pressures remain well controlled, which offers scope for a reduction in early May.
The market seems to concur, along with interbank futures which involving only a 30 % probability of an easing in the recent week, although rising to nearly 100 % by May.

Such kind of move would be a break for the Labor government, which is bending in the polls however still set to bring a tough budget on 8th May, a week after the May policy meeting of Central Bank.

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Tag Words: rba, australian retail sales, reserve bank of australia

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