The National Retail Association has applauded the Reserve Bank’s decision not to implement an eleventh straight interest rate increase, urging the RBA to carefully consider any further hikes.
“We ask the RBA to take its time before instituting another rate rise in May, and give the economy a chance to recover and adjust to the current landscape,” said Greg Griffith, chief executive of the Retail Association.
“Inflation is down 6.8 per cent from 7.4 per cent last month, which comes as no surprise given consumers are reining in their spending even on non-discretionary items.
“The retail sector needs targeted support to ensure Australia’s small and medium-sized business community can get on top of their expenses before they are hit by another economic challenge.”
Reserve Bank Governor Philip Lowe said yesterday the board decided to hold interest rates steady at 3.6 per cent to “provide additional time to assess the impact of the increase in interest rates to date and the economic outlook.”
Lowe did, however, point to future rate rises as an inevitability.
“The Board expects that some further tightening of monetary policy may well be needed to ensure that inflation returns to target,” he said.
“The decision to hold interest rates steady this month provides the Board with more time to assess the state of the economy and the outlook, in an environment of considerable uncertainty.
“In assessing when and how much further interest rates need to increase, the Board will be paying close attention to developments in the global economy, trends in household spending and the outlook for inflation and the labour market.”
