Australian retail sales remained unchanged in January 2008 compared to December 2007 but were 7.1% higher than a year ago. Also small downward revisions were made to December -0.2% and November -0.1%.
Is this month's slowing just an overdue pause after growing at a strong clip over the past 6 months? Or is this the start of a more gradual moderation in retail sales as the effects of higher interest rates and inflation are being felt by the consumer?
Whatever the answer one month does not make a trend. However given that the RBA has tightened monetary policy by 100 bps in the last 8 months consumers may start to tighten their belts in coming months.
Tuesday, 4 March 2008