Australian Dollar Gains As Consumer Confidence Picks Up At Last
- The Australian Dollar was already gaining on its US cousin when the Aussie consumer provided some good news
- Westpac’s confidence index picked up after three months of falls
- Consumption remains under something of a cloud though
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The Australian Dollar gained Wednesday on news of improving consumer confidence.
Major lender Westpac’s index on the subject rose by 0.4% on the month in July. While objectively that might not look like much, it is a big improvement on June’s 1.8% fall. It’s also the first rise seen for four months.
However, with the index itself at 96.6, it’s still far from clear that Aussie consumers have really perked up very much, which probably explains the rather muted reaction from AUD/USD. While Australia’s economy continues to do relatively well, much of its success is down to the export sector’s buoyancy with rather less hanging on a consumer sector mired in debt and rising housing costs.
Australian interest rates are at record lows and thought likely to remain so for the rest of 2017 and well into the next year.
The Australian Dollar made some gains after the release, but was already gaining on a generally weaker US Dollar. The greenback had been weakening since Tuesday’s New York session in which US President Donald Trump’s son released an email chain citing Russian support for his father before last year’s Presidential vote.
--- 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.