Australia's real sales in line with long-term trend, low inflation weighs on retail turnover

Australia's retail sales are expected by market consensus to be 0.4% month on month on a seasonally adjusted basis, being unchanged from that of its previous month.

Retail sales in October stood at 3.7 yoy. If there would be steep decline in AUD exchange rate, this is not usual, but to some extent can be justified by intense competition, particularly in food retailing, while new entered ones unleashed a price war. Weak global commodity prices also contributed.

"We do not see a reversal of these trends any time soon, but expect downward pressures on prices to ease. In part because of this, we expect slightly stronger growth in food sales", says Societe Generale in a research note.