NAB Business Conditions and Confidence survey
Early Tuesday sees the February month releases of the National Australia Bank (NAB) Business Conditions and Confidence survey results around 00:30 GMT. The headline sentiment gauges gave intermediate strength to the Aussie Dollar (AUD) during early last-month with upbeat figures for January amid dovish tilt from the Reserve Bank of Australia (RBA). With the Australian central bank still holding its bearish bias intact, not to forget rate cut signals from the Governor Phillip Lowe, the business sentiment gauges will be closely observed. Forecasts suggest soft figures to take place in February as Business Confidence may weaken to 3 from 4 prior whereas Business Conditions could also decline to 5 from 7 earlier.
Analysts at Wespact say, “The RBA will be among those watching the Feb NAB business confidence survey at 11:30am Syd/8:30am Sing/HK. In H1 2018, both the headline confidence and conditions indexes were well above long term averages, but both fell substantially in H2 2018. Both ticked up slightly in Jan, the conditions index to +7 (versus a 25 year average of +6) and confidence to +4 (25 year average also +6).”
TD Securites say, “NAB confidence and conditions barely moved in January after the material step down in December. However, with a looming Federal election in May likely to generate a change in government not promoting business-friendly policies, there is little scope for a rebound in the near-term.”
How could the data affect AUD/USD?
In light of latest pessimism surrounding the RBA’s dovish bias and the Governor Lowe’s comments indicating future rate cut, the AUD/USD may have to trim some of its most recent gains if the business sentiment gauges fail to hold their January month strength.
The AUD/USD pair may aim to surpass 0.7110 nearby resistance and rush towards 50-day simple moving average (SMA) of 0.7135 on positive outcomes whereas 0.7050, 0.7020 and 0.7000 are likely immediate supports to watch in case the survey results spread disappointment.
Key notes
AUD/USD: Recovery dubious, still scope for the 0.6857/78.6% retracement
About the NAB Business Conditions survey
The NAB´s Business Conditions released by the National Australia Bank looks at trading, profitability and employment conditions in Australia. It serves as an indicator of overall economic situation in the short term. A high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or bearish).
About the NAB Business Confidence survey
The National Australia Bank Business Confidence is a survey of the current business condition in Australia. It indicates the performance of the overall Australian economy in a short-term view. A positive economic growth anticipates bullish movements for the AUD, whereas a negative growth is seen as bearish.
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