The Reserve Bank of Australia has come to retailers’ rescue in time for the most important retail trading period of the year after announcing a 0.25 per cent reduction in the cash rate.
According to Glenn Stevens, RBA governor, subdued demand conditions and the high Australian exchange rate have helped contained inflation recently.
“With overall growth moderate, inflation now likely to be close to target and confidence subdued outside the resources sector, the Board concluded that a more neutral stance of monetary policy would now be consistent with achieving sustainable growth and 2 to 3 per cent inflation over time,” he said.
Commenting on this was Australian Retailers Association (ARA) executive director Russell Zimmerman who said the announcement brings “some well-deserved and long-awaited hope over the festive season”.
“While retailers still have a long road ahead towards long term economic recovery, this will at least be a short term boost for retailers who were bearing the brunt of the pressures on consumers brought about by mortgage stress, the soaring cost of living and having to negotiate new taxes into their household budgets,” he said.
“Hopefully we will see some more consumers walk through doors and populate their trees in readiness for Christmas.”