In November 2023, Australian retail sales experienced their largest increase in ten months, rising by 0.8% from October and reaching A$37.1 billion ($23 billion). This surge was attributed to Black Friday promotions; however, it fell short of analysts’ expectations of a 1.0% increase. Many believe the uptick merely advanced holiday spending, potentially depressing December sales due to the trend from the prior year. Despite the rise in sales, the Australian dollar fell by 0.3% following the announcement. Spending at department stores increased by 1.8%, while dining expenses grew by 1.5%. Ben Udy, lead economist at Oxford Economics, noted that the extended popularity of Black Friday complicates the interpretation of consumer spending trends. The current economic climate remains cautious, with investors anticipating potential interest rate cuts from the Reserve Bank of Australia (RBA) due to a recent decline in core inflation and disappointing consumer spending recovery. The RBA has kept rates steady at 4.35% since raising them from a 0.1% pandemic low, aiming to control inflation while supporting employment. Markets are now betting on a 60-78% likelihood of a rate cut in February.
