Weak Australian retail sales boost chances of RBA rate cut — Reuters

According to Reuters, Australian retail sales growth remained nearly flat in May, marking the fourth consecutive month of sluggish performance. While clothing purchases increased, they were offset by a decline in food sales. The Australian dollar weakened by 0.2% to $0.6569 in response.

Consequently, markets are pricing in a 97% likelihood that the Reserve Bank of Australia (RBA) will announce a 25-basis-point rate cut at its meeting next Tuesday. This expectation is further supported by persistently weak economic growth and low inflation risks. Since February, the RBA has already reduced borrowing costs twice, Reuters notes.

Data from the Australian Bureau of Statistics (ABS) revealed a 0.2% month-on-month increase in retail sales for May, falling short of the expected 0.4% growth. Total sales reached 37.3 billion Australian dollars ($24.5 billion), up 3.3% year-on-year.