Latest research from Macquarie claims close to three quarters of retailers expect profits to either decline or stay stable for fiscal year 2020.
As per The Australian, a Macquarie survey of 2,000 retailers found nearly half indicated negative trade for the Easter and end of financial year period – with many bracing for further profit declines.
The news comes despite a recent uptick thanks to Reserve Bank cuts to the official cash rate as well as changes to tax collection and a 3 per cent increase to the minimum wage.
Australian Retailers’ Association executive director Russell Zimmerman recently told ChannelNews consumer confidence would be up in the wake of tax changes and cuts to the cash rate.
The Macquarie findings indicate retailers are less optimistic, with 72 per cent of respondents saying they expected profit to either decline or stay steady at best.
That number is still somewhat of an improvement over the Christmas period, where 83 per cent of respondents predicted profits wouldn’t grow.
Macquarie highlighted JB Hi-Fi and Harvey Norman as two retailers that outperformed expectations last financial year, but analysts now believe shares in the two companies are overvalued.
