31 May 2012

Retail therapy waning

11:13 am on 31 May 2012

Retail sales in Australia fell for the first time in 10 months in April, with the promise of a cut to the official cash rate doing little to encourage consumers to open their wallets.

Official figures from the Australian Bureau of Statistics show spending fell 0.2% in the month following a rise of 1.1% the month before.

The ABC reports sales had been expected to rise slightly in the period.

A drop of 0.8% in sales of household goods was the largest contributor to the result. There were also were declines in spending at department and clothing stores.

But shoppers spent more on food and eating out - turnover at cafes, restaurants and supermarkets rose.

Market Economics managing director Stephen Koukoulas says consumers have fallen into a thrifty mindset, that will be difficult for policy makers to break.

The official cash rate was lowered by the Reserve Bank of Australia to 3.75%. It was previously 4.25%.