Growth in Australian retail sales will accelerate in the next two years as consumer confidence continues to grow on the back of increasing employment, according to a new report by Access Economics. The study claims that, adjusted for inflation, retail sales will grow by 2.6% in the fiscal year ending 30 June 2010, then grow by 2.7% in the next fiscal year, and by 3.8% in the year after that.

The report said, “The surge of new jobs at the end of 2009 and start of 2010 provides a solid foundation for retail sales in the year ahead. A greater sense of job security makes for a more confident consumer -- one who is more likely to be spending”. Australian companies hired another 194,600 people in the five months through January, the biggest increase in more than three years, driving the unemployment rate to an 11-month low of 5.3%.

However, the report warns that the central bank’s decision to raise borrowing costs in recent months will affect disposable incomes, adding, “The shallow economic downturn means Australia enters the recovery with relatively little spare capacity, leaving the Reserve Bank weary of inflationary pressures”.

NamNews - Wednesday 10th March 2010

See column on the right for related news items
or search our NamNews Archive containing over 9 years of industry news (Subscriber-only)