Australia’s economy grew moderately last quarter as a strong trade performance and the largest rise in consumer spending in almost three years helped offset softness elsewhere. Wednesday’s data showed gross domestic product (GDP) expanded by 0.5 percent in the fourth quarter, compared to the previous quarter when it rose by 0.4 percent.
“The good news is we’ve now completed 23 years of continuous growth,” said Michael Blythe, chief economist at Commonwealth Bank. “The bad news is we’re still running below trend, which will keep upward pressure on the unemployment rate and the RBA (Reserve Bank of Australia) on rate-cut watch.” The result matched market forecasts, which was a relief to many analysts who had feared the risks were for a weaker outcome and lifted the local dollar a quarter of a cent AUD=D4.
The economy grew 2.5 percent for all of 2014, a result that actually topped the United States but remained well short of the 3.25 percent that is considered its ideal running pace. After trimming interest rates to a record low of 2.25 percent in February, the RBA skipped a further move this week but left the door wide open for an easing in coming months.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.