Retailers said today’s Reserve Bank of Australia’s (RBA) decision to hold the cash rate at 3.85 per cent is a blow for consumer and business confidence and will undercut the recovery of the sector.
The Australian Retailers Association (ARA) and National Retail Association (NRA) said retailers are disappointed by the decision, as the sector continues to battle tough economic headwinds.
“Weak consumer spending and high business costs continue to put pressure on retailers,” said ARA CEO Chris Rodwell. “With inflation well within target range, today’s RBA decision is a missed opportunity to bolster the outlook of operators around the country. Retail conditions remain subdued by historical standards and relief is sorely needed.
“With one-in-ten Australians employed in retail, we need our $430 billion sector to lift. A stronger economic outlook can’t happen without a retail recovery.
“Retailers are among the most resilient and adaptable sectors in the country – but they’ve also copped more than their share of challenges in recent years.
“Retailers have been battling higher costs of doing business across the board – rents have spiked, we’ve seen significant wage and superannuation rises, along with higher energy, insurance and supply chain costs and unfortunately, an enormous wave of retail crime.
“Global competition is well and truly on our doorstep with ultra-low-cost digital retailers like Temu and Shein scooping up a growing share of local spending, without being held accountable to the same standards as our local retailers.
“On top of these challenges, businesses are tied up in regulatory reform, navigating the biggest set of workplace changes in decades. Many small businesses simply don’t have the resources to cope.
“That’s why Australia needs to see a bold agenda on productivity and red-tape reduction. It’s vital we remove barriers to business investment and strengthen the resilience of our local retailers, who contribute almost one fifth of our national gross domestic product.
“We stand ready to support the Federal Government with its productivity and economic reform agenda. And we urge the RBA to stay vigilant to opportunities to provide relief in the near term,” said Mr Rodwell.