Australian retailers on Tuesday expressed concerns with the Reserve Bank of Australia's cash rate decision to maintain the cash rate at 4.75%.

After the announcement of RBA Governor Glenn Stevens, Australian National Retailers Association (ANRA) CEO Margy Osmond said this move has left retailers with less hope of Christmas cheer.

“The Reserve Bank’s decision today to leave the cash rate stable will do little to raise the hopes of retailers that Christmas will bring much of a bounce to retail trading figures,” Mrs Osmond said.

“Retailers will welcome some stability, but to see any real movement for the sector, interest rates need to drop. We know that even talk of moves in the cash rate leads to an immediate impact on the retail sector. If commentators speculate on a decrease, consumers return to shopping – and the opposite occurs if an increase to the cash rate is on the cards."

Mrs Osmond said the RBA Board has previously noted the difficulties for the retail sector and acknowledged the existence of a ‘cautious consumer’ in Australia, despite the economic outlook, but this has not translated into action on interest rates.

“Retailers will be looking for action, in the form of a drop in the cash rate, before the end of the year as a catalyst to a Christmas boom in shopping. Christmas 2011 is shaping up to be one of the most important shopping periods for the sector in many years.

ANRA explains retailers are currently experiencing growth of about 1.4% when the average growth rate is 6%.

“Last year 2010 saw retail spending grow just under 2% and 2011 is shaping up to be an even bigger disappointment for the sector, ” Mrs Osmond said.