- Alex Joiner, economist at Bank of America Merril Lynch
Australia's retail sector faced another weak month in November, adding to further signs that the Reserve Bank of Australia needs to deploy fresh stimulus measures to stimulate the nation's economy. Retail sales in the South Pacific country rose marginally by 0.1% in November from the previous month, whereas economists had predicted a 0.2% increase. The data appeared to be the weakest since August, when sales crawled at around the same pace as in November. The worse than expected result reflects lackluster confidence among businesses and consumers as the nation's jobless rate hovers near decade highs amid a sharp slowdown in mining investment, which has supported Australia's economy for almost a decade. Weaker retail sales in November was not broad-based, as spending categories including household goods and hospitality experienced robust monthly growth rates of 0.6% and 0.8%, respectively. In October retail sales climbed 0.4%, following a strong 1.3% jump in September due to launch of the new iPhone. All eyes now turn to next month's report, when December sales data will provide an insight into how retailers fared in the Christmas and Boxing Day period. Retail spending may received a boost from falling fuel prices in December, but confidence was undermined last month as commodity prices plummeted amid concern about slowing growth in the global economy and an increasing supply of raw materials after a decade-long resources investment boom.
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