When is the Australian Retail Sales and how could they affect AUD/USD?
|Retail Sales overview
Early Wednesday, the market sees the final reading for the March month Retail Sales data from Australia at 01:30 GMT. Following a 0.5% increase in February, markets are expecting to confirm the initial estimation of an 8.2% rise in the key data. It should also be noted that the quarterly reading of the Aussie Retail Sales for the first quarter (Q1) 2020 will additionally populate the calendar at the same time as the monthly outcome.
Traders are particularly interested in the data as the Australian Bureau of Statistics (ABS) said the March month increase, as per the preliminary readings, was the strongest seasonally adjusted rise ever in the series.
Analysts at Westpac don’t turn down the market forecasts while saying:
Westpac is looking for an extraordinary stockpiling surge of 8.2% month reported in the preliminary estimate to be confirmed in the final read. Real retail sales for Q1 will also be published. Westpac expects a solid rise of 1.6%, largely driven by the strong nominal sales of March. However, the wider consumption measures reported in the national accounts may record a decline over the quarter - retail only makes up 30% of total consumption, and many other segments are more susceptible to a shock from the virus.
Elsewhere, TD Securities seem following the trend as it says:
The ABS released a preliminary survey two weeks ago that suggested retail sales in the month rose a record 8.2% m/m, driven by a 22% rise in supermarket and grocery store sales. We expect the official data to reflect the preliminary survey. Markets look for Q1 retail sales volumes to grow 1.8% q/q.
How could it affect AUD/USD?
With the latest pullback, during the last hour, AUD/USD drops 0.10% to 0.6425 ahead of the data on early Wednesday. The pair traders earlier cheered the hopes of the US economic re-open and upbeat prints of the Retail Sales data can help register a three-day winning streak. However, any disappointment might not be taken lightly as the data is before the actual pandemic-led lockdown and downbeat prints ahead of the economic standoff could weaken the Aussie traders’ sentiment. Additionally, Tuesday’s RBA also portrayed a downbeat economic scenario and may add burden onto the Aussie pair in a case of disappointment from the data.
Technically, a daily closing below 21-day SMA level of 0.6390 becomes necessary for the bears to aim for the late-April low surrounding 0.6250. Until then, 0.6490 and 100-day SMA near 0.6550 can keep the pair’s upside momentum checked.
Key Notes
AUD/USD clings to modest gains above 0.6400 with eyes on Aussie Retail Sales
AUD/USD Forecast: Limited enthusiasm despite a better market mood
About Australian Retail Sales
The Retail Sales released by the Australian Bureau of Statistics is a survey of goods sold by retailers is based on a sampling of retail stores of different types and sizes and it's considered as an indicator of the pace of the Australian economy. It shows the performance of the retail sector over the short and mid-term. Positive economic growth anticipates bullish trends for the AUD, while a low reading is seen as negative or bearish.
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