Aussie Dollar Reslient as Consumer Confidence Wilts
- Australian consumers are heading into the holiday season in less-than-festive mood
- The Westpac indicator for December registered a big fall
- But the Fed-watching Aussie Dollar didn’t move much
The Australian Dollar was steady on Wednesday despite yet another piece of soft economic data out of its home country.
The closely watched consumer confidence index from local banking major Westpac came in at 97.3 for December, a fall of 3.9%. November’s had been 101.3, a fall of 1.1%. This news comes hard on the heels of a woeful official growth print for the year’s third quarter and will do nothing to raise hopes that the fourth quarter stands to show much improvement.
The data will also be chilling for retailers as they show consumers in grim mood as the crucial holiday sales period looms. 97.3 is the lowest print for this index since April, and makes October’s 102.4 look like something of a peak.
However, with Australian markets currently as fixated on the US Federal Reserve as all the rest, the data didn’t cause the Australian Dollar much of an immediate problem. Similarly gloomy results on analogous sentiment surveys may have also dulled the impact of this particular release. AUD/USD actually ticked higher in the aftermath, but the cross remains pinned under the 0.75 handle.
The confidence data won’t dent the thesis that more Australian interest rate cuts could be coming, but the Reserve Bank of Australia may decide to let the Fed do some of that lifting for it. After all, the higher US rates widely seen as coming this week will burnish the US Dollar’s comparative charms.
Unfazed by yet more patchy data: AUD/USD
Chart compiled using TradingView
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--- Written by David Cottle, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.