Retail and Service Post Flat Numbers For June

The service and retail sectors remain weak as the latest report shows these industries are still posting lower numbers for the moth of June, with the most recent rate being the lowest since the economy fell.

Sales were flat for the whole month, especially in clothing and retail. Many restaurants also resulted in a turnover. Sales slightly rose in South Australia, Victoria and Queensland, but NSW remained flat. The Northern Territory, Western Australia and Tasmania numbers showed declining numbers.

Figures from the report also show that there was a decline of 0.1% in April and a revised 0.2% growth rate in May.

With the Reserve Bank implementing another rate cut by Tuesday, this would the first time in an election year that the RBA is easing on monetary policies. Experts in the financial markets are saying that the cut would probably fall under a 25 basis point, but a small number of group believes this would be a 50 basis point cut.

Industry players are hopeful that the next rate cuts would boost consumer spending. But according to experts from Moods Analytic, “Households aren’t responding to rate cuts the way they traditionally have. Retailers are struggling as households continue to pay down debt rather than markedly increase discretionary spending.”

According to economists, further rate cuts may not be able to push spending, but an NAB spokesperson said that other sectors can benefit from this and help the economy.