Banking & Saving - Sales come early in an effort to stimulate economy

The uncertainty in today's economy has made consumers nervous and retailers are doing everything in their power to get them to part with their money.

This has resulted in some of the big sales that are not traditionally seen until Boxing Day or later already appearing in retailers.

This seems to be the same story across most countries effected by the global financial crisis, with people becoming more thrifty with their money due to recent circumstances retailers are deperate to keep sales up.

Another reason that has been said to be responsible for these widespread sales is that when retailers were forecasting sales last spring, nobody had predicted how severe the crisis would be, so now they have a back-log of stock that needs to be sold.  

Richard Evans of the Retailers Association said: "What consumers need to understand is that saving their money for a rainy day, well, it's absolutely pouring outside right now,"

The Retailers Association said that the recent interest rate cuts and the Federal Government's stimulus package will provide people with a greater income, and has warned that holding on to cash will continue to slow the economy and could lead to a further increase in unemployment.

Research carried out by the peak industry group has shown almost half the retailers are holding substantial sales before Christmas, but shoppers have not reacted as expected and are yet to fill the shops.

The crisis has slowed expansion to a stand-still, with no new outlets planned for next year.

Clive Peeters chief executive Greg Smith said: "All the good retailers will survive the cycle and come through,"

"But along the way you can expect some retailers to just find it too hard - some of the smaller retailers perhaps."

Few analysts are saying Christmas trade will match the 10-year-high of last season.

But retailers are optimistic that the Christmas cheer will elevate consumer confidence in time for  more sales in June.