Keeping a firm hand on the tiller by keeping the cash rate stable is the only way retail will realise a recovery in 2011, the Australian National Retailers Association (ANRA) said today.

Taking its cue from the inflation jitters set by other neighbors in the Asia-Pacific Region, the Reserve Bank of Australia has maintained the country's benchmark rates steady on the fifth straight meeting at 4.75 percent.

ANRA CEO Margy Osmond welcomed the RBA decision.

“Retail continues to watch the RBA decisions with baited breath, knowing any increase in that rate will strike a blow to the sector,” she said.

According to Mrs Osmond, retail figures for March will be released on Thursday and while recent numbers have suggested a stronger sector, they reflect natural disasters and lengthy January sales periods rather than consumers popping their heads out of their savings burrows. A lift in March would be a positive sign for the sector.

“Retailers will now be turning their attention to the Federal Budget next Tuesday for any cuts that will eat into Australian families spending.

“The sector is well aware that consumer behaviour has shifted, that Australians now are choosing to save rather than spend and utility and petrol prices are also taking their toll on the family budget, leaving less cash in hand to indulge in shopping.

Mrs Osmond said any changes in the Budget that will force families to tighten their own budgets will have a direct impact on the retail sector.