The past three Christmases were the worst on record for retailers. While there are signs of optimism this festive season without COVID restrictions and bushfires, a financial hangover looms in 2023 | EXCLUSIVE by swrighteconomy & MsEmmaK
Australian households are expected to embrace a “freedom Christmas” without COVID restrictions or bushfire smoke before enduring a financial hangover in 2023 as inflation and soaring interest rates almost bring the economy to a standstill., policymakers believe Australians will go on a spending binge at the first Christmas since 2018 unaffected by events that have curbed expenditure for the past three holiday seasons.
Barrenjoey chief economist Jo Masters said the savings buffer built up by Australians through the past two years was likely to be spent this Christmas, but next year will be much tougher. Australia’s retail sector has cheered the return to in-store shopping over the sales period, with some of the nation’s biggest operators reporting strong spending as consumers approach a restriction-free Christmas.
The spending of this Christmas, however, is expected to run into the reality of much higher mortgage rates, falling real wages and a global economic slowdown caused by central banks using interest rates to bring inflation under control.The Reserve Bank expects the share of household income spent on interest payments to reach record or near-record highs after falling to all-time lows when it had the cash rate at 0.1 per cent.
“Looking ahead, retailers are likely to face a difficult six months as they ring in the new year. With cost-of-living pressures and a mortgage rate squeeze clouding the horizon, retailers are growing pessimistic about the state of the consumer in 2023,” he said. “The recent devastating floods are another challenge, likely to both add to inflation and slow growth in the short-term, given already frustrated supply chains.”
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
COVID-19 cases rise in aged care ahead of third pandemic ChristmasAged care facilities are dealing with rising numbers of coronavirus cases, as facilities ask families to adhere to their rules while visiting loved ones to keep residents safe.
Read more »
COVID-19 cases rise in aged care ahead of third pandemic ChristmasThe sector is hopeful for a more normal holiday season with smaller outbreaks and guaranteed access to visitors, but is asking the public to remember the risks.
Read more »
COVID-19 cases rise in aged care ahead of third pandemic ChristmasAged care facilities are dealing with rising numbers of coronavirus cases, as facilities ask families to adhere to their rules while visiting loved ones to keep residents safe
Read more »
‘Freedom Christmas’ has people spending, but the hangover is coming next yearPolicymakers expect Australians to enjoy their first Christmas in years unaffected by COVID restrictions and bushfires before being stung by inflation and interest rates in 2023.
Read more »
Fears of deadly infection surge as China abandons zero-Covid policyDramatic U-turn following widespread unrest leaves country ill-prepared for Omicron
Read more »