When is the Aussie GDP release and how could it affect the AUD/USD?

Australian GDP overview

Global markets are now gearing up for Australia’s third-quarter (Q3) Gross Domestic Product (GDP) figures, up for publishing at 00:30 GMT on Wednesday. The reason being the Reserve Bank of Australia’s (RBA) latest refrain from a clear bearish bias while keeping the statements that suggest the rates to remain low in 2020. Forecasts suggest the annualized pace of economic growth to come in at 1.7%, a slight tick above the previous period's 1.4%, while the quarter-on-quarter numbers are expected to remain unchanged at 0.5%.

Ahead of the outcome, Westpac said:

GDP growth over the year to Q2 was just 1.4%, the slowest pace since 2009 and revealing that the economy was declining in per capita terms. Favorable base effects should ensure that annual growth at least improves – Westpac looks for 0.6%qtr, 1.8%yr. The median forecast is 0.5% but many are on 0.6%. The arithmetic of our Q3 GDP forecast is: domestic demand 0.3% (upgraded from 0.2%); inventories +0.2ppts; and net exports +0.2ppts, as well as statistical discrepancy (-0.1ppt). Growth is lopsided – centered on inventories, exports and public spending – with ongoing weakness in private demand (across the consumer, housing and business investment).

The Australia and New Zealand Banking Group (ANZ) conveys the details with the RBA’s latest statements while saying:

The big event today is Australian Q3 GDP. We expect a rise in GDP of 0.6% q/q, which would see annual growth lift to 1.7% from 1.4%, consistent with the RBA’s characterization of a “gentle turning point”. Once again, private demand looks to have been very weak. The mainstay of economic growth remains public demand. This highlights the difficulty for the government and the RBA in generating measures to support the economy when public spending is already the key driver of growth.

How could it affect the AUD/USD?

While the broad risk-off, mainly due to trade war risk between the United States (US) and China, seems to lack strength in disappointing the Aussie buyers, upbeat growth figures could add fuel to the pair’s run-up. On the contrary, prices are already nearing three weeks’ high and a disappointment from the data, which is less expected, could offer sellers an opportunity to enter.

Technically, 100-day Exponential Moving Average (EMA) near 0.6840 acts as immediate support, a break of which could recall 0.6800 mark, while 0.6920/30 area including 200-day EMA and November month’s top stays on the bull’s radar during further upside.

Key notes

AUD/USD holds in bullish territory, awaiting Aussie GDP

AUD/USD Forecast: Bullish ahead of Q3 GDP

About the Aussie GDP release

The Gross Domestic Product released by the Australian Bureau of Statistics is a measure of the total value of all goods and services produced by Australia. The GDP is considered as a broad measure of the economic activity and health. A rising trend has a positive effect on the AUD, while a falling trend is seen as negative (or bearish) for the AUD.