Australian retailers report falling consumer confidence amid rising interest rates and food prices
Major Australian retailers said cost-of-living pressures are reducing demand, while the Reserve Bank of Australia is expected to implement another interest-rate increase.
Australia’s leading retailers said consumer spending is being constrained by higher food prices and ongoing interest-rate hikes. Woolworths chief executive Amanda Bardwell told investors that, although the average price of groceries has fallen, shoppers are increasingly seeking the lowest-priced options and showing less brand loyalty. > "The amount of pressure on young families, particularly, and families more broadly is increasing," Bardwell said.
Other retail groups, including JB Hi-Fi, Super Retail Group and Bunnings, reported similar trends. JB Hi-Fi chief executive Nick Wells said the company is seeing “variability in trading and heightened competitive activity, with customers remaining focused on value and increasingly shopping during promotional events.” He added that sales had slowed ahead of the Black Friday and Christmas periods.
Wesfarmers chairman Rob Scott noted “persistent cost pressures with elevated inflation and rising interest rates” are moderating demand across its businesses, such as Bunnings and Kmart. He referenced the Reserve Bank’s recent rate hikes and indicated a further increase is anticipated at the upcoming Melbourne Cup meeting.
The Australian Bureau of Statistics released data showing September inflation rose to 4.3 percent, above expectations. RBA Governor Michele Bullock highlighted additional pressures from higher energy costs linked to geopolitical tensions in the Middle East and from a strong demand for AI-related technology components.
A Foodbank survey cited in the article found that one in three middle-income households reported experiencing food insecurity, underscoring the broader impact of the cost-of-living crisis on Australian families.