The Reserve Bank of Australia’s decision to cut the cash rate by 25 basis points to 3.85 per cent has been welcomed by retail industry groups.
The Australian Retailers Association (ARA) and National Retail Association (NRA) said the cut, though later than hoped, offers welcome relief for both consumers and businesses.
Chris Rodwell, CEO of the ARA, said they hope the decision nudges business and consumer confidence in the right direction.
“A lower cash rate should have a positive flow-on effect to retail businesses, many of which are highly dependent on discretionary spending. That’s why we urge the RBA to stay vigilant to opportunities to provide further relief.”
Rodwell said small businesses, in particular, have struggled with rising costs and reduced spending over the past five years.
“Interest rates are one part of the equation. We now need to see some policy changes that will give retail the license to grow. The biggest ticket item is improving productivity by cutting red-tape and applying downward pressure to business costs like energy, leasing, insurance and compliance. We’re also keen to collaborate with government on solutions for retail crime and supply chain resilience.
The ARA and NRA also acknowledged that the full benefits of the rate cut may take time to appear.
“While this is a boost, alongside the more positive March trade figures from the ABS, we need to see much greater relief before we are close to a recovery.
“We’re keen to see continued rate cuts by the RBA to help ignite the economic recovery Australians are waiting for,” said Rodwell.
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