Increased consumer spending expected over Christmas
A recent report has suggested that consumers in Australia may be splashing out this Christmas thanks to increased consumer confidence and the rising Australian dollar.
There is no doubt that over the past year the picture has looked pretty bleak for retailers in Australia and in many other countries, as consumers have had to deal with the double whammy of the global credit crunch and the recession, both of which have had a profoundly negative impact upon their finances and their ability to spend.
However, according to a recent report things may be set to brighten up as Christmas approaches, with a number of factors expected to play a part in increased consumer spending over the festive season. Officials have said that many Australians used the government’s stimulus payments to make an impact on their debts, leaving them with more available cash to put aside, and this has resulted in an increase in consumer confidence. Another contributory factor, according to officials, will be the soaring Australian dollar.
Many retailers are now keeping their fingers crossed for a more lucrative Christmas than had originally been predicted, with many predicting that the increase in consumer confidence will also lead to an increase in consumer spending.
One retail official said: “It’s definitely going to be a better Christmas than last year. Even though there is no economic stimulus this year, there is a much higher level of consumer confidence. And the rising Australian dollar means that the prices of electronic goods and big-ticket imported goods are coming down even as we speak.” He said that retailers would continue to cut prices in order to increase sales, adding: “Retailers will be trying to get more sales, so they cut their prices, but margins will be hurt. And that’s the problem.
Source - The Australian