Talking Points:
- The Australian Dollar declined against its major counterparts on current account data
- Current account deficit shrank to –A$11.4b, net exports cut 0.2% of GDP in the 3Q
- RBA rate decision and then GDP figures could offer more volatility for the Aussie Dollar
How well have DailyFX analysts’ Q4 forecasts measured up with what markets actually did? Take a look here !
The Aussie Dollar depreciated against its major counterparts after Australia’s current account balance crossed the wires. The nation’s current account deficit shrank from –A$15.9 billion in the second quarter to -11.4b in the third. This was lower than the -13.5b analysts’ consensus as well as the smallest deficit since the first quarter of 2014.
More interestingly, net exports detracted 0.2 percent of GDP last quarter, the same as what happened in Q2. Analysts were expecting net exports to neither add nor subtract from output growth. This puts the spotlight on tomorrow’s Australian GDP report. Markets are expecting the nation’s economy to grow just 0.2% Q/Q in the three months through September.
Aside from the GDP figures tomorrow, an RBA rate decision is due in just a couple of hours. The markets are not pricing in a change in policy this time around. However, Senior Currency Strategist Ilya Spivak mentioned that the statement accompanying the announcement may be market-moving as investors try to divine where officials will steer next.
AUD/USD (15min chart)
Chart compiled using TradingView
