Aussie bulls put out a strong showing this week on a combination of a not-so-dovish statement from the Reserve Bank of Australia and mostly positive sentiment on the U.S-China trade war front.
Australian Headlines and Economic data
- Australia Retail Sales rises by 0.2% m/m in September vs. 0.4% in August
- Australia job ads fall in October to 2.5-year low: ANZ
- Despite positive global risk sentiment to start the week off of further U.S.-China trade deal optimism, the Aussie fell to majors during the Monday session, likely on a combination of the tick lower in retail sales and a decent probability the RBA will cut interest rates this week.
- Strong move to the upside for the Aussie against the majors, likely on the combination of an improvement in Australia’s services sector sentiment in October , but also on the RBA holding off on rate cuts for now by keeping the official cash rate at 0.75% following Reserve Bank’s November meeting
- Global risk sentiment soured during this session, likely on news that the U.S.-China trade deal signing could be pushed into December, which could be the driver of Aussie weakness during U.S. trading hours
- Australia Construction PMI Climbs To 43.9 – AiG
- Australia’s trade surplus surprises to the upside, widens to 7.18B AUD
- On top of the positive Australian data to lift the Aussie earlier in the day, the Aussie likely also benefited from news that China says it has agreed with U.S. to cancel tariffs in phases
- RBA meeting minutes: Growth improving and labor market resilient, but uncertainties from trade tensions remain
- New lending commitments to Australian households rose 1.1% in September 2019, following a 3.8% rise in August
- Risk sentiment turned south going into the weekend to have likely weakened the Aussie after reports of internal opposition to the trade deal and after Trump said he has not agreed to roll back the tariffs on China.