Retail sales overview
Early Friday, the market will see preliminary Australian retail sales readings for the month of September at 00:30 GMT. Market consensus suggests an optimistic MoM impression of + 0.2% vs. -1.7% from previous readings, suggesting the first positive figure in the past four months.
Given recent strong inflation data and firmer Australian Treasury yields coupled with the easing of foreclosure restrictions in Australia, today’s retail sales numbers become more important for AUD / USD traders .
Before the data, TD Securities said:
We expect retail sales to rebound in September by 0.8% m / m (vs. 0.3%), reversing 3 straight months of declines due to prolonged state lockdowns. Improving consumer confidence and optimism about reopening plans should boost spending. Additionally, spending at QLD is expected to rebound given the looser restrictions in the month following the mid-month lockdown in Southeast QLD in August. The strength of the rebound in retail spending will be closely watched over the next few months with NSW and VIC easing most restrictions in October and could bolster expectations that the economy is on a much stronger recovery path than ever before. ‘had predicted the RBA.
How could this affect the AUD / USD?
AUD / USD consolidates weekly gains around highest levels since July, down 0.18% a day to around 0.7530 ahead of data release. In doing so, the pair of risk barometers justifies the market’s cautious mood in the absence of an agreement on US President Joe Biden’s $ 1.75 trillion infrastructure spending plan. Market sentiment also deteriorated amid inflation fears ahead of the release of data on basic personal consumption expenditure (PCE) – the price index for September, the Fed’s preferred inflation measures.
That being said, Australia’s retail sales figures must follow the high inflation figures from the start of the week to push RBA policymakers to reject the phrase “no cash rate change until” in 2024 “. The same could push AUD / USD prices towards the new multi-day high. In the absence of this, comments from RBA Governor Philip Lowe placing greater emphasis on wage growth could regain market attention and join the current mood of risk weighing on the listing.
Technically, the AUD / USD remains out of the way until it is between 200-DMA and the monthly support line, around 0.7560 and 0.7500 respectively.
AUD / USD consolidates gains above 0.7500 ahead of Australian retail sales
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About Australian Retail Sales
Retail sales published by the Australian Bureau of Statistics is a survey of products sold by retailers, based on a sample of retail stores of different types and sizes and is considered to be an indicator of the pace of the Australian economy. It shows the performance of the distribution sector in the short and medium term. Positive economic growth anticipates bullish trends for the AUD, while a low reading is seen as negative or bearish.