Australia central bank grapples with forecasting impact of retail competition on inflation

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Australia central bank grapples with forecasting impact of retail competition on inflation
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Heightened retail competition in Australia has had a 'profound' impact...

FILE PHOTO: Pedestrians walk past the Reserve Bank of Australia Building in Sydney's central business district, May 5, 2016. REUTERS/Jason Reed/File Photo

In recent years, major global retailers including Amazon.com have entered Australia, leading to price wars, a major factor causing tepid inflation. “After a long period where retail prices tended to rise at roughly the same rate as inflation generally, for the past decade or so, these prices have been flat to falling,” RBA Assistant Governor Luci Ellis said in a speech in Geelong, about 75 kilometers southwest of Melbourne.

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