Australia retail sales volumes dip in Q4, price growth slows

SYDNEY – Australian retail sales volumes fell for the first time in a year last quarter as shoppers trimmed spending on goods, a sign higher borrowing costs are finally working to curb spending.

Data from the Australian Bureau of Statistics on Monday showed real retail sales dipped 0.2 percent in the December quarter to A$96.9 billion ($66.99 billion). That was still better than market forecasts of a 0.6 percent fall and will make a slight drag on economic growth.

The report also showed growth in retail prices was the slowest all year in the quarter, which might reassure the Reserve Bank of Australia (RBA) that its aggressive policy tightening is starting to cool demand, albeit slowly.

The central bank meets on Tuesday as is widely expected to hike rates by a quarter point to 3.35 percent.