Market News & Analysis

Australian dollar rallies on retail sales and trade data

Apr 4, 2019 | Market Update

High-impact economic news:

14:35 JPY 30-y Bond Auction
22:30 EUR ECB Monetary Policy Meeting Accounts
01:00 CAD Ivey PMI

The Australian dollar has rocketed backed above 71 US cents, reversing losses suffered after a dovish RBA rate statement, earlier this week. The AUD/USD closed 0.58% higher on Wednesday at 0.7111 and has again extended gains in early trade.

Buyers were encouraged by a spike in retail sales data and the nation’s trade balance. For the month of February, retail sales rose 0.8% vs 0.3% forecast. It’s significantly higher than January’s read of just 0.1% and proves consumers are still spending at the check-out. Australia’s trade balance also hit its highest level on record thanks to rising iron ore prices, coming in at $4.8 billion vs $3.71 billion forecast. This means more Australian goods and services were exported than imported in February; another sign the Australian economy hasn’t tanked.

If strong economic data wasn’t enough, fresh reports have emerged that China and the United States are another step closer to inking a trade deal. Not only did this news help the Aussie, it also saw strength in the Euro. The Euro hit a weekly high against the USD and a near 2-week high against the Japanese Yen, encouraged by a positive Purchasing Managers Index from Germany, France, Italy and Spain. The overall Eurozone Final Services PMI came in at 53.3 vs 52.7 forecast, revealing the services industry is still expanding.

The USD ended mixed against major currencies while equities pushed higher on trade deal enthusiasm. The greenback fell against the Euro, Aussie and Pound Sterling, but climbed to a near 3-week high against the Yen. The USD/CAD ended the session flat at 1.3345. Wall Street stocks closed in the black with the Dow Jones rising 39 points or 0.15% while the S&P 500 closed 6 points or 0.21% higher. The Nasdaq rose 46 points or 0.6% with Amazon and Apple stocks enjoying a positive session. Traders are now turning their attention to tomorrow night’s non-farm payroll figures and unemployment rate.

Good trading from EightCap

* The information provided here has been prepared by EightCap’s team of analysts. All expressions of opinion are subject to change without notice. Any opinions made may be personal to the author and do not reflect the opinions of EightCap.

In addition to the disclaimer on our website, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. EightCap accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.

Please note that past performance is not a guarantee of or prediction of future performance. This communication must not be reproduced or further distributed without prior permission.

 

 

 

 

 

HEAD OFFICE

Level 6, 360 Collins Street
Melbourne, VIC
3000 Australia

Risk Warning: Margin trading involves a high level of risk, and may not be suitable for all investors. You should carefully consider your objectives, financial situation, needs and level of experience before entering into any margined transactions with EightCap, and seek independent advice if necessary. Forex and CFDs are highly leveraged products which mean both gains and losses are magnified. You should only trade in these products if you fully understand the risks involved and can afford losses without adversely affecting your lifestyle (including the risk of losing substantially more than your initial investment). A Product Disclosure Statement (PDS) and a Financial Services Guide (FSG) for our products are available to download from our Legal Documentation page. You must assess and consider them carefully before making any decision about using our products or services.

EightCap is a registered business name of EightCap Pty Ltd (ABN 73 139 495 944). We are regulated by the Australian Securities & Investments Commission (ASIC) - our AFSL number is 391441. This licence authorises us to provide financial services to people in Australia.

The information on this website is of a general nature only and is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation. EightCap is not a financial adviser, and does not issue advice, recommendations, or opinion in relation to acquiring, holding or disposing of a margined transaction. We provide general advice only and accordingly you should consider how appropriate the advice (if any) is to your objectives, financial situation and needs before acting on the advice.