AUD: Weaker following disappointing retail sales data - BBH
|The analysis team at BBH points out that the Australian dollar is the weakest of the major currencies and is off about 0.7% to near $0.7320, new lows since the first half of January as it was initially sold in response to disappointing retail sales.
Key Quotes
“March retail sales fell 0.1%. The median guesstimate in the Bloomberg survey was for a 0.3% increase after a 0.2% decline in February (revised from -0.1%). It is the third decline in the past four months. In Q1, adjusted for inflation, retail sales rose 0.1%, which represents a dramatic slowing from the 0.7% (initially 0.9%) rise in Q4 16.”
“The Australian government's budget news may have helped spur fresh sales. The government projects a larger than expected deficit. The stimulus is understood to take some pressure off the central bank's monetary efforts. However, investors were already uneasy about the levy on banks that had been tipped. The government will introduce a tax of six basis points on banks with liabilities greater than A$10 bln. This is expected to raise A$6.2 bln in revenue. The UK, Sweden, and Germany have similar levies.”
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