“Retailers are doing their best to keep prices down,” Mr Zahra said. “Going into the new year, I do expect to see prices going up. We’re seeing that happening now.”
AMP Capital chief economist Shane Oliver expects retail sales data for the month of November, to be released in December, will be even stronger as consumers make the most of the sale weekend and take heed of warnings to shop sooner rather than later.
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“All this talk of shortages of certain items may bring forward some spending,” Dr Oliver said. “The retail [sector] is going to see fairly strong demand over the next five weeks … given the reopening and reasonably strong levels of consumer confidence and a lot of pent-up spending power.”
Westpac is predicting a modest 1 per cent gain in retail spending for October, but is forecasting 3-4 per cent for November.
While Mr Zahra expects supply chain issues won’t abate until 2023, Dr Oliver noted that the price of semiconductors, shipping costs, coal and oil, though still at high levels, have started to abate.
“It looks like we may be starting to pass through the worst of it,” he said.
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