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  • Rate Cut Chances Rise As Retail Sales Remain Poor - 4 August 2013 (AFR) 0 comments
    Sep 16, 2013 10:33 AM
    Rate cut chances rise as retail sales remain poor

    4 August 2013

    Retail sales continued their lacklustre run into a fourth month, boosting the Reserve Bank of Australia's scope to deliver an official interest rate cut on Tuesday.

    My View: (4 August 2013)

    The latest Australian retail sales growth remained flat continuing its dismal run since March. Latest inflation data showed a 2.7% increase on annualised basis over last year (July). Although, most economists/analysts have already priced-in a 25bps fall in the RBA Cash rate, I am of the opinion that the RBA may just decide to hold off any decrease till the next meeting. One of the primary drivers is house prices that has seen a steady rise over this year with recent auction clearance rates back at new highs. This factor coupled with decline in US$ longs could push the A$ up in the near term.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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