Aussie Dollar Update
Apr 17th 2012, 1:21 pm
#1
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Aussie Dollar Update
The Australian dollar was the week's second best performer, strengthening by a cent against the pound. All of that gain came on Thursday morning, following strong employment data.
It was not an especially fruitful week for Australian ecostats. Westpac's index of consumer confidence fell by -1.6% in April from 96.1 to 94.5 after an even bigger -5.0% fall in March. There were also back-to-back monthly falls for home loans; -2.5% in February after -1.1%. Inflation expectations among the public were higher in April at 3.3%, dimming hopes for lower interest rates (the Reserve Bank of Australia pays particular attention to expectations in its policy deliberations).
The corn-curer, however, was the employment report. Instead of rising as expected to 5.3%, unemployment was steady at 5.2%. The even better news was that employers hired a further 44.0k staff in March. The figure more than offset the previous month's -15.4k decline and blew away expectations of a 6k increase.
If you would like more information please contact me directly or check out our BE currency page
It was not an especially fruitful week for Australian ecostats. Westpac's index of consumer confidence fell by -1.6% in April from 96.1 to 94.5 after an even bigger -5.0% fall in March. There were also back-to-back monthly falls for home loans; -2.5% in February after -1.1%. Inflation expectations among the public were higher in April at 3.3%, dimming hopes for lower interest rates (the Reserve Bank of Australia pays particular attention to expectations in its policy deliberations).
The corn-curer, however, was the employment report. Instead of rising as expected to 5.3%, unemployment was steady at 5.2%. The even better news was that employers hired a further 44.0k staff in March. The figure more than offset the previous month's -15.4k decline and blew away expectations of a 6k increase.
If you would like more information please contact me directly or check out our BE currency page
Apr 24th 2012, 8:44 am
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Re: Aussie Dollar Update
Every dollar on the planet had a difficult week and the Aussie was no exception, keeping pace with its US namesake on the way to a loss of more than two and a half cents against sterling. It was not just that the Australian economic data were a disappointment; figures from the UK were better than expected.
The only positive Australian indicator was motor vehicle sales, which jumped by 4.0% in March. Import and export prices both fell in the first quarter of 2012. Factory gate prices were down too, halving the annual rate of increase to 1.4%.
Meanwhile in Britain a fall in the unemployment rate and unexpectedly strong retail sales in March forced a reappraisal of the pound by investors. On Friday the Bank of England's trade-weighted sterling index touched its highest level in 20 months.
If you would like more information please contact me directly or check out our BE currency page
The only positive Australian indicator was motor vehicle sales, which jumped by 4.0% in March. Import and export prices both fell in the first quarter of 2012. Factory gate prices were down too, halving the annual rate of increase to 1.4%.
Meanwhile in Britain a fall in the unemployment rate and unexpectedly strong retail sales in March forced a reappraisal of the pound by investors. On Friday the Bank of England's trade-weighted sterling index touched its highest level in 20 months.
If you would like more information please contact me directly or check out our BE currency page
Apr 30th 2012, 12:48 pm
#3
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Re: Aussie Dollar Update
There was little to choose between the pound and the Australian and New Zealand dollars. GBP/AUD was unchanged on the week while the NZ dollar lagged a negligible half-cent behind.
Australian economic pointers were reasonably plentiful. Monday's reading of first quarter factory gate prices put them -0.3% lower on the quarter and up by just 1.4% on the year- half the expected increase. Having seen those numbers, investors were less surprised than they might have been when consumer price index inflation halved to 1.6%. Taken together the data were enough to persuade investors that the Reserve Bank of Australia would lower its Cash Rate benchmark from 4.25% to 4% this week and by a further quarter percentage point to 3.75% in June.
Lower-profile statics this Monday morning played a supporting role. Private sector credit growth slowed to an annual 2.3% in March while HIA new home sales were down by -9.4% for the month. Neither was particularly helpful but no damage was done to the Aussie dollar.
If you would like more information please contact me directly or check out our BE currency page
Australian economic pointers were reasonably plentiful. Monday's reading of first quarter factory gate prices put them -0.3% lower on the quarter and up by just 1.4% on the year- half the expected increase. Having seen those numbers, investors were less surprised than they might have been when consumer price index inflation halved to 1.6%. Taken together the data were enough to persuade investors that the Reserve Bank of Australia would lower its Cash Rate benchmark from 4.25% to 4% this week and by a further quarter percentage point to 3.75% in June.
Lower-profile statics this Monday morning played a supporting role. Private sector credit growth slowed to an annual 2.3% in March while HIA new home sales were down by -9.4% for the month. Neither was particularly helpful but no damage was done to the Aussie dollar.
If you would like more information please contact me directly or check out our BE currency page
May 9th 2012, 9:40 am
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Re: Aussie Dollar Update
The eight-day week cost the Australian dollar three cents against the pound, making it the second worst-performing of the major currencies (the NZD brought up the rear). A major part of the Aussie's problem was the nervousness about weekend elections in Greece and France and their possible implications for growth in Europe and elsewhere.
The Australian economy itself also gave cause for concern. Purchasing managers' indices for the manufacturing and services sectors were both lower again and further into the contraction zone below 50 on their 0-100 scale. Manufacturing was four and a half cents lower at 43.9 while services slumped seven and a half points to 39.6.
In recognition of economic weakness and falling inflation the Reserve Bank of Australia lowered its benchmark Cash Rate by half a percentage point to 3.75%. It was a bigger cut than investors had expected and it forced them to consider the deteriorating Australian economic picture.
If you would like more information please contact me directly or check out our BE currency page
The Australian economy itself also gave cause for concern. Purchasing managers' indices for the manufacturing and services sectors were both lower again and further into the contraction zone below 50 on their 0-100 scale. Manufacturing was four and a half cents lower at 43.9 while services slumped seven and a half points to 39.6.
In recognition of economic weakness and falling inflation the Reserve Bank of Australia lowered its benchmark Cash Rate by half a percentage point to 3.75%. It was a bigger cut than investors had expected and it forced them to consider the deteriorating Australian economic picture.
If you would like more information please contact me directly or check out our BE currency page
May 22nd 2012, 1:49 pm
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Re: Aussie Dollar Update
Last week was a better one for the Australian dollar and a worse one for sterling than the week that went before. The net result was zero net change for GBP/AUD. It leaves the pound just short of its peaks in August and October last year, slightly ahead of the November high and 10% up from the record low three months ago.
The anti-euro frenzy has lost some of its bite with a date set for Greece's general election re-run and a purposeful statement emerging from the weekend G8 summit. Investors drained by crisis-fatigue have lost the will to carry on selling the euro and commodity currencies day after day. They are taking a break right now but are sure to be back on the job in an instant if fresh bad news emerges from Euroland.
The anti-euro frenzy has lost some of its bite with a date set for Greece's general election re-run and a purposeful statement emerging from the weekend G8 summit. Investors drained by crisis-fatigue have lost the will to carry on selling the euro and commodity currencies day after day. They are taking a break right now but are sure to be back on the job in an instant if fresh bad news emerges from Euroland.
