Australian retail sales fell short of expectations, increasing the likelihood of interest rate cuts.

Jin10 data reported on July 2, Australia’s retail sales growth in May was lower than expected, prompting traders to become more convinced that the Reserve Bank of Australia will cut interest rates as soon as next week. Data released by the Australian Bureau of Statistics on Wednesday showed that retail sales in May grew by 0.2%, up from flat in the previous month, but below the expected increase of 0.5%. A series of previous reports indicated that economic momentum is weakening, from easing price pressures to unexpected unemployment and cautious consumer sentiment, which strengthened the case for further rate cuts by the Reserve Bank of Australia. Traders have fully priced in the expectation of three more rate cuts this year, with the earliest likely to be next Tuesday.