Australian retail sales accelerated in October, marking its third straight month of gains as consumers turn more confident about their finances in anticipation the next move in interest rates is likely to be a cut. 

Sales advanced 0.6% from the prior month, exceeding a forecast 0.4% gain, figures from the Australian Bureau of Statistics showed on Monday. The outcome follows a 0.1% increase in September. 

“The stronger than usual October month saw some retailers enticing buyers to spend early with discounting, particularly on discretionary items,” said Robert Ewing, ABS head of business statistics. “The rise in discretionary spending was driven by online discounting events while people also spent more on electrical goods, particularly televisions and other audio-visual equipment.”

Retail sales can be an important consideration in policy decisions given consumption accounts for more than half of gross domestic product. The Reserve Bank has repeatedly highlighted the outlook for household spending as a key uncertainty as it has held rates at 4.35% throughout the year.

Monday’s data showed retail sales rose 3.4% from a year earlier, compared with 1.2% in October 2023. 

The RBA meets next week, with economists and markets predicting no change to rates until 2025. Governor Michele Bullock recently said inflation was still too high to consider any easing in the near term. 

Monday’s retail data also showed:
 

• Non-food industries had significant rises with household goods retailing up 1.4%
• The bounce-back in food retailing is being driven by liquor, climbing 1.7%
• Cafes, restaurants and takeaway food services rose 0.3%, its third straight monthly rise

The ABS intends to cease the publication of retail sales data from mid-2025. It is switching to a more comprehensive monthly report on household consumption that will be released Thursday.