Australia: Retail sales pick up, a sigh of relief - TDS

Sandeep Kanihama FXStreet Contributor

Annette Beacher, chief Asia-Pacific macro strategist at TD Securities, explains that the Australian retail sales came as a relief after disappointing Q3 GDP, which was due to weak growth in consumer spending as they rose by +0.3%/m in Oct.

Key Quotes

“Clothing and footwear rose by +2.6%/m, one of the weak spots of Q3 consumption (-0.2%/q). Similarly, Household goods rose by +0.6%/m, after falling by -0.2%/q in Q3.”

“Retail sales accounts for only one-third of actual consumption, where other weak spots in the Q3 consumption report - utilities and spending associated with vehicles - are not included in retail sales reports.”

“Rising chatter of the RBA delivering a rate cut next year has smashed the OIS curve. Pre-GDP, a Nov 2019 hike was 40% priced, then 30% priced, and now is marginally priced for a cut.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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