When is the Australian Retail Sales and how could they affect AUD/USD?
|Retail Sales overview
Early Friday, the market sees the preliminary reading for the December month Retail Sales data from Australia at 00:30 GMT. Following successive two months of recovery, recently by 7.1% YoY, AUD/USD traders fear a sober reading, some pessimists in the market also say -1.5%.
Ahead of the release, TD Securities said,
Retail sales are likely to remain robust in Dec, after the 7.1% m/m increase in Nov. To recap, we saw healthy sales in discretionary retail (14.3% m/m) in Nov as the economy reopens, and we expect the momentum to continue as consumers remain optimistic about the economic recovery.
How could it affect AUD/USD?
AUD/USD stays mildly bid around 0.7770, rising for the fourth consecutive day, by the press time of early Asian trading on Friday. The pair recently benefited from the upbeat prints of Australia’s preliminary readings of the Commonwealth Bank Manufacturing PMI for January, up 57.2 versus 55.9 prior. Also supporting the quote could be the cautious optimism in the markets after Joe Biden entered the White House as the 46th US President and easing virus-led restrictions in Australia, not to forget the previous day’s upbeat Aussie employment report for December.
Although fears of a downtick in the Retail Sales can’t be ruled out, the overall sentiment is less likely to be hurt and hence can keep the AUD/USD pair positive despite slightly weaker data, if any. Alternatively, an extended rise in the Retail Sales number could keep the bulls happy.
Technically, 21-day SMA near 0.7705, followed by lows marked since January 05 around 0.7658-65, seems to restrict the pair’s short-term downside. As a result, a descending resistance line from January 06, at 0.7800 now, lures AUD/USD bulls.
Key Notes
AUD/USD: Bulls targeting 0.7800 aren’t out of the woods, Aussie Retail Sales in focus
AUD/USD Forecast: Chances still skewed to the upside
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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