Dollar Freefalls, Interest Rates Plunge, but CE Prices Remain Steady

By Martin Vedris

SYDNEY: A volatile day on the Australian financial markets has seen the dollar drop to four year lows, the Reserve Bank make its biggest cut to the official interest rates since 1992, but at least one CE supplier maintain a steady course.

The morning news potentially had some crying in their coffee as the dollar dropped to four year lows against the US currency.

The afternoon news of the Reserve Bank’s decision to drop interest rates not a quarter or even a half percent as experts predicted, but a full one per cent, had mortgagees breathing sighs of relief.

The Australian this morning quoted major retailers Gerry Harvey of Harvey Norman, and Richard Uechtritz of JB Hi-Fi, saying that the falling dollar shouldn’t aversely affect sales in the lead up to Christmas.

Now Samsung has supported these retailers’ sentiments by saying that it does not expect to raise prices of its consumer electronics goods.

“Over the past several years we’ve seen the value of the Australian dollar fluctuate,” said a Samsung Australia spokesperson. “This has had a marginal effect on audio visual products with little or no change to pricing at store level.

“However for the home appliance side, we’ve seen slight price rises where the value of raw materials has been elevated over a long period of time.

“Samsung expects that the economic uncertainty relating to the dollar will not have a significant impact on consumer electronic sales in the lead up to Christmas. Christmas is traditionally a strong period for CE sales and with new LCD and Plasma TVs, MP3, DSC and camcorders, we believe Christmas 2008 sales will remain on par.”

In small appliances, one supplier has today said that some price increases may be likely to counter the rising costs. There is also speculation among industry commentators that a rise in whitegoods prices is likely from some major suppliers, if not this side of Christmas, then at some time in the New Year.

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