Forex News: Aussie Sold as Retail Sales Missed Expectations
THE TAKEAWAY: Retail sales slowed by 0.1 percent falling short of expectations > Poor sales reflects negative consumer confidence and may influence RBA to reduce rates > AUD/USD sold
The Australian dollar lost value versus the U.S. dollar as Australian retail companies sold -0.1 percent fewer goods in November falling short of consensus which called for +0.3 percent gains. Retail sales in October posted no change.
Anemic retail sales in December could provide confirmation that Australian consumers are not very confident on the future outlook of their economy and thus appear reluctant to spend. Such behavior may prompt central bankers to lower borrowing costs further which reduces the home currencies’ attractive yield feature. The next RBA meeting is scheduled for February 5 at 3:30 GMT. Currently markets appear to be pricing in a 40 percent probability that policy officials will reduce interest rates by 25 basis points.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.