Retail trade restrained by stubbornly high saving rate

Yesterday’s ABS National Accounts data were good news, showing a continuation of strong growth in demand in Queensland at 3.6% over the June quarter. One of the most interesting pieces of data in the National Accounts is the household saving ratio, which remains stubbornly high as a result of the uncertainty that has persisted since the 2008 financial crisis:

The high household saving ratio is a major reason that, although the economy is performing reasonably well, many retailers continue to struggle.

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This entry was posted in Macroeconomy, Retail trade. Bookmark the permalink.

5 Responses to Retail trade restrained by stubbornly high saving rate

  1. Gavin Nicholaon says:

    Check out http://www.eurekareport.com.au/graphs/list Shows savings may not be that high over the long term – a return to a more normal level?

    • 800psi says:

      Agreed. And savings are either investment or delayed consumption. Neither of which are bad in the long run.

      • Gene Tunny says:

        Yes, in the long-term the economy will adjust and we’ll be better off from having a higher savings rate, but in the short-term it is clearly having adverse impacts on the retail sector.

    • Gene Tunny says:

      Thanks for the link Gavin. It’s possible that the financial crisis has permanently shocked us into the savings habits of the generations that went through war and depression. However I expect that, once things settle down in the world economy and the domestic economy appears stronger, the savings rate will decline.

  2. Pingback: Qld loses 20,000 sales jobs over last 12 months | Queensland Economy Watch

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