The National Retail Association (NRA) has warned that the Reserve Bank of Australia’s (RBA) eighth consecutive interest rate hike will officially make them this year’s ‘Grinch who stole Christmas’.
Interim CEO Lindsay Carroll said the RBA has no doubt used the recent dip in inflation from 7.3 percent to 6.9 percent as an excuse to take a further bite out of household consumption with an official rate increase to 3.1 percent, the highest in a decade.
“These rate rises are unprecedented and will make it even harder for Australian consumers to appropriately budget over the holiday spending season.
“Retail turnover was down 0.2 percent in October, the first decline of the year, indicating that households are feeling the impact of higher bills and are reeling in their discretionary spending.
“The RBA needs to give it a rest. The retail sector is reliant on shoppers being able to afford the special end-of-year celebrations. We don’t want people to have to choose between celebrating Christmas or living comfortably on a day-to-day basis.
“These misguided attempts to curb inflation have done nothing to impact the true culprits of rising costs, the supply-side challenges, and rising energy prices. Not to mention the IR Bill that was recently passed will only serve to increase inflationary pressures.
“The NRA’s Consumer Sentiment Report released in October revealed that 71 percent of consumers had changed their spending behaviour because of rising costs and that purchasing decisions during the upcoming sales events would be largely driven by the discounts and offers available.
“Retailers will have to adjust quickly, and they may have to adjust in ways they can’t afford in order to match their offerings to their consumers’ ability to spend.
“The Grinch’s heart grew three sizes, and he ended up returning everything he stole. We don’t see that happening with the RBA’s insistence on robbing Australian shoppers of the Christmas spirit,” she said.