Retail Sales Overview
Early Wednesday, the market sees preliminary readings of Australia’s seasonally adjusted Retail Sales for March month at 01:30 GMT. Market consensus suggests an intact seasonally adjusted monthly print of 0.2% MoM, suggesting a reduction in the pressure for the Reserve Bank of Australia (RBA) to act faster to tame inflation woes.
Given the Reserve Bank of Australia’s (RBA) latest hawkish surprise despite recently softer Aussie inflation data and the mixed comments from the RBA officials, not to forget the challenges to sentiment, today’s Aussie Retail Sales data appears crucial for the AUD/USD traders.
How could it affect AUD/USD?
AUD/USD stays pressured around 0.6650, consolidating the Reserve Bank of Australia-inspired gains by retreating from a one-week high. In doing so, the Aussie pair bears the burden of the sour sentiment and the market’s cautious mood ahead of the key data/events.
That said, the recent chatters surrounding the Aussie recession, amid fears of comparatively higher rates in Australia than the US, may also seek validation from today’s Aussie Retail Sales data. Hence, recovery in the key statistics may allow the AUD/USD buyers to extend the latest run-up to cross the immediate technical hurdle while a negative surprise, which is less likely, could recall the Aussie pair buyer by highlighting the hawkish Fed concerns.
It should be noted, however, that the Aussie data may have a knee-jerk reaction for the AUD/USD pair as traders are more interested in the US ADP Employment Change for April and the ISM Services PMI for the, as well as the Federal Open Market Committee (FOMC) monetary policy meeting announcements.
Technically, a daily closing beyond a three-month-old descending resistance line, around 0.6720 by the press time, becomes necessary for AUD/USD buyers to retake control.
AUD/USD pares RBA-inspired gains below 0.6700 ahead of Australia Retail Sales, Fed
AUD/USD Forecast: Upside limited after being unable to hold above 0.6700
About Australian Retail Sales
The Retail Sales released by the Australian Bureau of Statistics is a survey of goods sold by retailers based on a sampling of retail stores of different types and sizes and it’s considered an indicator of the pace of the Australian economy. It shows the performance of the retail sector over the short and mid-term. Positive economic growth anticipates bullish trends for the AUD, while a low reading is seen as negative or bearish.
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While many investors in the foreign exchange market keep a close eye on economic data releases from around the world, the Australia Retail Sales report often goes overlooked compared to other key economic indicators. Nevertheless, this report is one of the most important leading indicators for the Australian economy, and should be taken seriously by FX traders looking for potential opportunities on the AUD/USD pair.
Australia Retail Sales is a monthly report released by the Australian Bureau of Statistics (ABS). It provides an overview of sales activity in the retail sector, and can provide an important window into spending in the larger economy. Specifically, it is used to measure the levels of consumer spending which makes up a large part of overall growth.
The Australia Retail Sales report is released on the 18th of each month. The data in the report cover the previous month, and can carry significant weight for the AUD/USD pair. When retail sales are stronger than expected, it can provide a boost to the Australian dollar and drive AUD/USD higher. Conversely, weaker than expected figures can lead to declines in the AUD/USD pair.
Traders should always remember the importance of the Australia Retail Sales report when looking to take a position in the AUD/USD pair. The report can give important insights into the underlying health of the Australian economy and can provide a hint at future activity in the currency pair.
In summary, Australia Retail Sales is an important leading indicator of economic activity for the Australian economy and can have a meaningful impact on the AUD/USD pair. While it might not always make headlines compared to other indicator releases, FX traders should be aware of its significance and use the data to inform their trading decisions.