The National Retail Federation foresees a 2.8 percent increase in retail sales in time for the 2011 holiday season notwithstanding the chronic consumer improbability over the stock market, increasing unemployment and economic events in Europe.

Even online retail businesses remain optimistic that they are capable of attaining a 12 percent increase particularly with regards to selling of Christmas gifts, according to reports from Globe Newswire.

However in Australia, an online survey showed that consumers would be more inclined to pay off debts instead of putting in more money to Christmas shopping if the Reserve Bank of Australia decides to reduce interest rates in the coming week.

The survey found out that more than 50 percent of respondents prefer to settle mortgages should RBA officials announce that the improving inflation outlook could serve as basis to bring up interest rate policies by at least 4.75 percent.

Just 16 percent of 460 individuals surveyed declared that they would use savings from a cash cut for holiday shopping while 17 percent stated that they plan to increases their savings. The remaining 12 percent claimed the rate cut does not make a difference.

The Business Spectator reported that "Loan Market chief operating officer Dean Rushton said a rate cut would be welcome relief for many consumers with the central bank having kept interest rates unchanged for almost a year. The survey results showed that consumers remain very wary and even an initial rate reduction may not be enough to produce significant changes."

Commercial banks in Australia have been given an explicit warning by the RBA that there is no reason private banking institutions should raise mortgage rates beyond any changes to the official cash rate according to news.com.au.

If the central bank trims down interest rates on Nov. 1, retail banks should cut mortgage rates by the same amount.

Debelle praised Australian banks for keeping away from the pressures plaguing their European counterparts, which have seen the cost of borrowing from international money markets go up considerably in the previous months.