Australian Dollar Unmoved Despite Building Approvals Beat
- Australian building approvals beat forecasts in April
- This probably came as a relief to some investors given permits’ shock March swoon
- The Aussie Dollar barely moved though
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The Australian Dollar was steady against its US cousin Tuesday after a slightly better-than-expected set of data from the construction sector.
Building approvals rose 4.4% on the month in April, coming in stronger than the 3% rise forecast. The annualized fall was 17.2%, again better than the 18.1% fall feared. The Australian Bureau of Statistics said that the number of dwellings approved rose by 0.1% in April “in trend terms.” This measure has risen for three straight months and remains “relatively stable,” albeit below mid 2016’s record highs, the Bureau went on.
The sector is already in the spotlight because of the Reserve Bank of Australia’s known focus on the housing market when setting monetary policy and also because of building permits’ shock March collapse which hit the wires earlier this month.
The latest numbers suggest that things are now more stable, but the annualized retreat from the peaks goes on and will bear watching. In all events AUD/USD went nowhere on the release. It continued to loiter around the 0.7425 area.
At present rate futures don’t price in any rise for Australia’s record-low 1.5% official cash rate this year and indeed well into next. That said, markets don’t expect rates to fall further either as RBA leaders have repeatedly worried that still-lower borrowing costs would only exacerbate the country’s high personal debt levels.
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--- Written by David Cottle, DailyFX Research
Contact and follow David on Twitter: @DavidCottleFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.