Aus­tralia re­tail sales rise, trade gap nar­rows

The Pak Banker - - Front Page -

SYDNEY

Aus­tralia's re­tail sales ad­vanced more than economists fore­cast in Septem­ber and the na­tion's trade deficit nar­rowed by the most in five months, send­ing the lo­cal cur­rency higher ahead of to­mor­row's cen­tral bank meet­ing.

Sales climbed 0.5 per­cent to A$21.6 bil­lion ($22.4 bil­lion) from Au­gust, when they rose a re­vised 0.3 per­cent, the Bureau of Sta­tis­tics said in Sydney to­day. That ex­ceeded the me­dian fore­cast for a 0.4 per­cent gain. The trade short­fall shrank by A$420 mil­lion to A$1.46 bil­lion in Septem­ber, also more than fore­casts.

Con­sumer spend­ing has been fu­eled by in­ter­est-rate re­duc­tions since Novem­ber 2011 as the Re­serve Bank of Aus­tralia tries to but­tress de­mand out­side of a re­source boom that may crest next year. Cen­tral bank Gover­nor Glenn Stevens cut the key rate by a quar­ter per­cent­age point last month to 3.25 per­cent, and traders are pric­ing in a 54 per­cent chance he will lower bor­row­ing costs again to­mor­row.

"The RBA has eased some­what pre-emp­tively," said Michael Turner, an econ­o­mist at RBC Cap­i­tal Mar­kets Ltd. in Sydney. "Whether the board sees fit to move again as soon as to­mor­row has be­come an in­creas­ingly un­cer­tain prospect given the sta­bi­liza­tion in data in China and the US"

The Aus­tralian cur­rency, which has risen 52 per­cent in the past four years, traded at $1.0363 at 1:34 p.m. in Sydney com­pared with $1.0344 be­fore the re­lease.

To­day's re­tail re­port showed spend­ing on house­hold goods gained 1.2 per­cent, while con­sumers spent 0.6 per­cent more on food and 0.8 per­cent more on a cat­e­gory la­beled other retailing. They spent 0.6 less on cloth­ing, footwear and per­sonal ac­ces­sories and cut de­part­mentstore pur­chases by 0.5 per­cent, it showed.

Wool­worths Ltd. (WOW), Aus­tralia's largest re­tailer, posted the fastest first-quar­ter sales growth from su­per­mar­kets open at least a year since 2009 as pro­mo­tions and food price in­fla­tion drove growth, the com­pany said in an Oct. 18 state­ment.

Re­tail sales, ad­justed to re­move in­fla­tion, de­clined 0.1 per­cent in the three months through Septem­ber from the pre­vi­ous quar­ter. Economists had fore­cast a 0.2 per­cent de­cline.

The trade re­port showed ex­ports fell 1 per­cent to A$24.2 bil­lion, led by an 11 per­cent drop in metal ores and min­er­als. Im­ports de­clined 2 per­cent to A$25.6 bil­lion on an 11 per­cent drop in ma­chin­ery and in­dus­trial equip­ment and a 34 per­cent fall in a cat­e­gory that in­cludes civil air­craft, the re­port showed.

Aus­tralian em­ploy­ers hired al­most three times the num­ber of work­ers economists fore­cast in Septem­ber, a gov­ern­ment re­port showed Oct. 11, even as the un­em­ploy­ment rate jumped to 5.4 per­cent, the high­est since April 2010, from 5.1 per­cent. A pri­vate re­port

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