Harvey predicts more gloom, higher prices

By Chris Nicholls

SYDNEY: Gerry Harvey has predicted retail conditions will continue to stay poor until at least next year and said he also expects price rises in many areas in coming months.

Speaking on the ABC’s Lateline Business program last night, Harvey gave a wide-ranging interview covering everything from retail conditions to how he had lost money on ANZ and NAB shares.

“There is a slowdown,” he said. “We were going very strong – 12 or 13 or 14 per cent growth up until December and then January to June was more like one, two, three, four, five per cent growth.”

He said the July to December period this year also “doesn’t look that good at the moment”.

While Harvey said the pre-Olympics spend on flat panel TVs was a positive, decreases of up to 30 per cent in ASPs meant actual dollars in the till stayed stagnant.

“Even in July, our notebook sales were up, but again, prices are cheaper all the time.”

However, such prices were not likely to last, said Harvey.

“You are probably seeing Australia at the moment in all the products we sell at about as low as it’s going to get, I think, In the next twelve months, we’re going to see a lot of price rises,” he said.

While things may be down, there upside was that Harvey did not see any interest rate rises before the end of the year, saying any such rise would be “catastrophic.”

As he stated in May to Current.com.au though, things may be bad, but people needed to keep perspective.

“At the moment, we’ve got full employment out there, our sales are not that bad, it’s been a lot worse than this in times of recession years gone by with high unemployment and that sort of thing,” he said.

The full interview is available here.

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