Macrobusiness Chief Economist Leith Van Onselen says Australian households experienced the “biggest decline” in household disposable income in the world last year.

“All the talk then was about this higher than expected inflation figure which could potentially lead to another rate hike from the RBA,” Mr Onselen told Sky News host Danica De Giorgio.

“I think this week’s retail sales have actually put a dampener on that.

“Retail sales unexpectedly fell by 0.4 per cent in March, and they are up only 0.8 per cent.

“Once you subtract population growth … what it means is households effectively cut back on their retail spending by about five per cent … that is a massive cut back.”