AUD/USD edges higher as retail sales beat estimate

Aussie edges higher as retail sales beat estimate

AUD/USD is trading marginally up on the day after Australia’s retail sales came in higher than expected in June. Sales rose 0.4% m/m, matching the expansion seen in May and higher than the +0.3% economists had predicted. With June data now available, the summary for the second quarter is complete and registered a 1.2% increase quarter-on-quarter, also higher than the 0.8% forecast, which could bode well for Q2 GDP, though this is not due to be released until September 4. AUD/USD had a knee-jerk reaction higher, but not aggressively so, reaching an intra-day high of 0.7373, as the US dollar retained its bid tone it had acquired in the NY session.

AUD/USD Hourly Chart

Source: Oanda fxTRade

Other currency pairs were equally confined to tight ranges. USD/JPY slid 0.01% as the Nikkei225 trimmed 0.57% off the index. GBP continued its weaker bias after the Bank of England’s dovish hike late yesterday, sliding to a two-week low of 1.3005 though notably still holding above the 1.3000 handle.

GBP Dives on Dovish BoE Hike

Yuan continues to reflect trade tensions

The People’s Bank of China fixed the yuan weaker by 0.6% against the US dollar today after headlines about China’s intention to retaliate against Trump’s musings to increase the tariff on the next $200 billion of Chinese goods to 25% from 10% hit the wires yesterday. In intraday trading, USD/CNH hit a new recent high of 6.8970, the highest since May 2017.

Today’s data slate included China’s Caixin Services PMI for July which showed a dip to 52.8 from 53.9 the previous month and well below forecasts of 53.7.

Monthly payrolls lottery on tap

Trading was understandably muted in Asia will all eyes on the release of July US nonfarm payrolls later today. Latest surveys suggest the US added 190,000 jobs in July, less than the 213.000 recorded in June and below the six-month moving average of 215,000. Related data is expected to show unemployment easing off to 3.9% after last month’s unexpected surge to 4.0% while average hourly earnings are seen rising 0.3% m/m, a faster pace than in June.

Dollar Awaits Jobs Report Amid Trade Uncertainty

Other data includes services PMI reading from across Europe, Eurozone retail sales and Canada’s trade data for June.

For a look at all of today’s economic events, check out our economic calendar: www.marketpulse.com/economic-events/

Have a great weekend.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Andrew Robinson

Andrew Robinson

Senior Market Analyst at MarketPulse
A seasoned professional with more than 30 years’ experience in foreign exchange, interest rates and commodities, Andrew Robinson is a senior market analyst with OANDA, responsible for providing timely and relevant market commentary and live market analysis throughout the Asia-Pacific region. Having previously worked in Europe, since moving to Singapore he worked with several leading institutions including Bloomberg, Saxo Capital Markets and Informa Global Markets, proving FX strategies based on a combination of technical and fundamental analysis as well as market flow information. Andrew began his career as an FX dealer with NatWest and the Royal Bank of Scotland in the UK.