IDEAS home Printed from https://ideas.repec.org/a/rba/rbabul/jun2016-02.html
   My bibliography  Save this article

Why Has Retail Inflation Been So Low?

Author

Listed:
  • Alexander Ballantyne

    (Reserve Bank of Australia)

  • Sean Langcake

    (Reserve Bank of Australia)

Abstract

Inflation in the price of retail goods has been surprisingly low for a number of years. The considerable depreciation of the Australian dollar over this period by itself would typically have led to higher retail inflation. This article considers whether the direct relationship between the exchange rate and retail inflation has changed, or if other developments in the retail supply chain can account for recent trends in retail inflation. There is little statistical evidence that the relationship between the exchange rate and retail inflation has changed. Discussions with retailers in the Reserve Bank’s business liaison program suggest that an intensification of competition in the retail sector and firms’ efforts to reduce costs along their supply chain are likely to have contributed to low retail inflation.

Suggested Citation

  • Alexander Ballantyne & Sean Langcake, 2016. "Why Has Retail Inflation Been So Low?," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 9-18, June.
    • Handle: RePEc:rba:rbabul:jun2016-02
    as

    Download full text from publisher

    File URL: https://www.rba.gov.au/publications/bulletin/2016/jun/pdf/bu-0616-2.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Elaine Chung & Marion Kohler & Christine Lewis, 2011. "The Exchange Rate and Consumer Prices," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 9-16, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Duke Cole & Samual Nightingale, 2016. "Sensitivity of Australian Trade to the Exchange Rate," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 13-20, September.
    2. Geoff Weir, 2018. "Wage Growth Puzzles and Technology," RBA Research Discussion Papers rdp2018-10, Reserve Bank of Australia.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kevin Lane & Tom Rosewall, 2015. "Firm-level Capacity Utilisation and the Implications for Investment,Labour and Prices," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 9-18, December.
    2. Fazal, Rizwan & Rehman, Syed Aziz Ur & Bhatti, M. Ishaq, 2022. "Graph theoretic approach to expose the energy-induced crisis in Pakistan," Energy Policy, Elsevier, vol. 169(C).
    3. Christian Gillitzer & Angus Moore, 2016. "Trade Invoicing Currency and First-stage Exchange Rate Pass-through," RBA Research Discussion Papers rdp2016-05, Reserve Bank of Australia.
    4. Burrel, Hamish & Vespignani, Joaquin L., 2020. "Industrial Impact of Economic Uncertainty Shocks in Australia: Revised," MPRA Paper 104117, University Library of Munich, Germany.
    5. Jamilu Iliyasu & Aliyu Rafindadi Sanusi, 2023. "The role of announced exchange rate policies on exchange rate pass-through to consumer prices in an oil-based small open economy," SN Business & Economics, Springer, vol. 3(1), pages 1-20, January.
    6. Joseph Musandiwa & Collins C. Ngwakwe, 2023. "The Effect of Exchange Rates on Consumer Price Index," Oblik i finansi, Institute of Accounting and Finance, issue 4, pages 47-52, December.
    7. Hamish Burrell & Joaquin Vespignani, 2021. "The Industrial Impact of Economic Uncertainty Shocks in Australia," Economic Papers, The Economic Society of Australia, vol. 40(3), pages 248-271, September.
    8. Augusto de la Torre & Eduardo Levy Yeyati & Samuel Pienknagura, "undated". "Latin America’s Deceleration and the Exchange Rate Buffer : LAC Semiannual Report, October 2013," World Bank Publications - Reports 16107, The World Bank Group.
    9. Manalo, Josef & Perera, Dilhan & Rees, Daniel M., 2015. "Exchange rate movements and the Australian economy," Economic Modelling, Elsevier, vol. 47(C), pages 53-62.
    10. Alexander Ballantyne & Tom Cusbert & Richard Evans & Rochelle Guttmann & Jonathan Hambur & Adam Hamilton & Elizabeth Kendall & Rachael McCririck & Gabriela Nodari & Daniel M. Rees, 2020. "MARTIN Has Its Place: A Macroeconometric Model of the Australian Economy," The Economic Record, The Economic Society of Australia, vol. 96(314), pages 225-251, September.
    11. Alexander Beames & Michael Kouparitsas, 2015. "Modelling Australia’s imports of goods and services," Treasury Working Papers 2015-02, The Treasury, Australian Government, revised Jun 2015.
    12. Jared Bullen & Michael Kouparitsas & Michal Krolikowski, 2014. "Long run forecasts of Australia’s terms of trade," Treasury Working Papers 2014-01, The Treasury, Australian Government, revised May 2014.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rba:rbabul:jun2016-02. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Paula Drew (email available below). General contact details of provider: https://edirc.repec.org/data/rbagvau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.