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Source: ONE News -
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Australians are loosening their purse strings and increasingly
spending their stimulus cheques on such things as computers and
televisions, business leaders say.
The heads of David Jones and Harvey Norman suggest it could be
because people think Australia may already have seen the worst of
the global recession.
The next 12 months will still be difficult for retailers, but consumer confidence is returning, says David Jones' CEO Mark McInnes.
Sales picked up in May and June on the back of federal government's fiscal stimulus payouts and more normal trading in the equities market.
"Once those two things happened, in combination, it was kind of this sense of relief and a sigh across the market of 'Wow, maybe that is as bad as it gets'," McInnes told Sky News.
"So we still think we're in for a difficult next 12 months, but consumer confidence is certainly higher now than it was at the same time last year."
Homewares, electrical and computer retailer Harvey Norman says sales in May and June were "quite good".
Chairman Gerry Harvey said notebook computer sales rose 35% in June, which was "enormous" even though last year's figures weren't great.
Sales of plasma and LCD televisions were up 26% last month.
"People are saying it's the stimulus package, and I think that's playing a part," Harvey told Sky News.
"But my view is six months ago we were talking about Armageddon and now there's a feeling out there (of) 'Hey, we're getting out of this, things are getting better'.
"People who were holding back are now letting go a bit."
Adding to the rosier picture being painted on Sunday was the release of the latest Olivier Job Index figures.
A decline in the number of jobs advertised on the internet levelled off in June, falling just 0.85% compared to May's 4.32% slump.
"On this evidence, the rate of decline is certainly decreasing, and the recruitment market is stabilising," group director Robert Olivier said.
"(But) it will take a few more months to know whether we're in recovery or if there's more bad news to come."
Federal Treasurer Wayne Swan also sounded a note of caution.
This week will see the release of housing finance figures for May and consumer sentiment data for July.
The Reserve Bank will decide whether to shift the official interest rate on Tuesday.
"But, without a doubt, the most important release will be the Australian labour force figures for June," Swan said in his weekly economic note.
"We know that the global recession is continuing to savage jobs around the world, with the US reporting an increase in its unemployment rate to 9.5% in June."
The jobless rate returned to a five-year high of 5.7% in May after a surprise fall in April.
For this June quarter, the federal budget forecast a jobless rate of 6%.
Meanwhile, all of the 19 economists surveyed by AAP expected the RBA to leave the cash rate at a 49-year low of 3% at Tuesday's board meeting, as more signs emerge that the economy is faring better than most amid the global recession.
