The Reserve Bank of Australia (RBA) has paused interest rates at 4.1 per cent in July, offering some leeway for retailers to settle amidst inflationary pressures.
In a statement, RBA governor, Phil Lowe, said the board has decided to hold interest rates “steady” this month and to provide “some time to assess the impact of the interest rate hikes to date”.
“The board remains alert to the risk that expectations of ongoing high inflation will contribute to larger increases in both prices and wages, especially given the limited spare capacity in the economy and the still very low rate of unemployment,” Lowe said.
He added that RBA will continue to “pay close attention” to developments in the global economy, trends in household spending and the forecasts for inflation and the labour market.
National Retail Association CEO, Greg Griffith, welcomed RBA’s decision adding it allows the retail sector to make use of the “positive momentum” gained in May.
“The resilience of the Australian retail sector speaks for itself, and we urge businesses to do what they can to boost morale and offer their customers experiences that inspire loyalty even through the inflation storm,” Griffith said.
He urged the RBA to “stay their hand for another couple of months” so businesses can find their directions before another rate increase.
This story first appeared on our sister publication Inside Retail
