Message to the Rudd government and the RBA
No interest rate rises before February 2010 at the earliest!
The Australian retail sector one of the largest employers of labour in Australia needs time to recover?

OK August retail trade numbers did increase in all states – after ordinary results for previous months some good news.

NSW 0.8%

VIC 0.6%

QLD 1.4%

SA 1.1%

WA 0.4%

TAS 1.4%

ACT 0.7%

The only territory to show a decline was the Northern Territory (-0.7%).

We agree with the sentiments expressed by Russell Zimmerman Executive Director ARA:

"Retailers are urging the RBA to carefully consider that anything taking cash away from consumers at the moment, including premature interest rate hikes, will be damaging to retail recovery and will stop funds flowing through the rest of the economy.

It is the view expressed by The RETAiL Alert Group in this and previous bulletins that retail, particularly clothing and footwear is still fragile – what the sales figures do not show is how many sales were forced discount sales with low margins – there is massive discounting taking place in Australian Shopping Centres.

Our read – the combination of margin cuts plus retailers receiving rent increases many above CPI in Shopping Centres is providing at best break even profit results but we suspect many retailers running way behind on profit last year with some in loss state - dangerous.

It behoves all retailers to get that message to the Rudd government and the RBA – no interest rate rises before February 2010 at the earliest; the Australian retail sector one of the largest employers of labour in Australia needs time to recover survival profits from one of the most difficult retail trading periods for years.

Here are the email addresses of the Treasurer Wayne Swan and the Minister for Competition and Small Business Craig Emerson for retailers to contact.

Tony Standley
Principal
The RETAiL Alert Group (Australia)
Mobile +61 (0)41 924 0497
e-mail info@adsass.com.au
Fax +61 (0)2 9987 0633
Website http://www.retailalert.com.au
 
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