The Reserve Bank of Australia (RBA) has decided to hold the interest rate at 4.1 per cent, which retailer groups described as a “significant blow” to consumer and business confidence.
“The RBA’s move to keep the cash rate on hold is a distressing decision for retail businesses around Australia – particularly given we are well within the target inflationary range outlined by the RBA,” said Australian Retailers Association chief industry affairs officer Fleur Brown.
“This certainly prolongs the pain many households and retail businesses are under and may unfortunately be a death sentence for some businesses,” she stressed.
Brown cited several problems facing the sector, including low consumer spending, high business costs, and geopolitical tension around trade and tariffs.
She called for more sustained efforts to drive momentum for the sector, which employs one in ten Australians and contributes $430 billion to the economy.
National Retail Association interim CEO Lindsay Carroll said retailers are already beginning to see the fruits of the latest rate cut, and the sector hopes for more cuts this year.
“We urge policymakers to focus on measures that boost investment and productivity, so, as Australia’s second-largest employer, retailers can continue to provide opportunity, job security, and sustainable growth for the economy, and maintain the momentum needed to drive recovery,” Carroll continued.
The latest cash rate announcement comes as the country’s retail sales recorded a modest 3.6 per cent year-on-year growth in February.
