Australia: Retail sales and trade data were softer than expected – RBC CM

Research Team at RBC Capital Markets, notes that Australia’s retail sales and trade data for May were both softer than expected.

Key Quotes

“The details for retail were also weak (inc a downward revision to April). This points to a deceleration in household spending in Q2 that is unlikely to be reversed into H2 given the knocks to confidence from recent political developments, and the slower rate of household asset inflation more broadly.

A resilient consumer has been a key part of the reason why headline growth has been buoyant. So headwinds to growth are growing. Moreover, data suggest that retail price inflation remains weak, which we expect will be confirmed in Q2 CPI (due 27 July).”