STRUGGLING retailers have missed out on a much-needed shot in the arm as the official cash-rate remained unchanged.
The Reserve Bank of Australia’s (RBA) Board of directors left the cash rate at 3.25 per cent citing significantly lower commodity prices and a moderate drop in trade activity.
The Australian Retailers Association (ARA) is disappointed with the decision as it had wagered that the RBA would “pump much-needed cash into the struggling economy”.
Executive director Russell Zimmerman (pictured) believes the RBA should reconsider.
“The government’s tight fiscal policy has taken from the pockets of businesses through increased costs around tax collection, which means the RBA will have to give back by cutting rates if consumers are to have any spare cash to spend in retail over the festive season,” he says.
However, the latest consumer sentiment survey from Lonergan Research suggests otherwise. The study found that less than a quarter of shoppers would use a pre-Christmas rate cut to increase discretionary spending.
Some 77 per cent of respondents claimed they would not spend more, even if the RBA reduced interest rates.
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