Retailers say a further fall in consumer spending has quashed any case for an interest rate rise in the lead-up to Christmas.
New government data, released today, showed retail trade in July fell for a second consecutive month, down by a seasonally adjusted 1.0 per cent, with all states and territories recording decreases in spending except the Northern Territory.
The Australian Retailers Association said while there is a lot of "good news'' in the economy at the moment, the further fall in retail sales should make the Reserve Bank wary.
"The RBA must carefully consider the current sensitive nature being displayed by consumers who will respond to rumoured interest rate increases by further tightening their purse strings,'' executive director Russell Zimmerman said in a statement.
"Anything that takes cash away from consumers at the moment, including premature interest rate hikes, will be damaging to retail sales in the lead up to Christmas.
"Retailers are still hopeful for a strong Christmas period this year.
"They don't need another blow while they are trying to recover from over 12 months of reduced trade,'' Mr Zimmerman said.
AAP
