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Aussie Tumbles at Start of the Week on Retail Sales Miss

Last updated 1/8/2012 8:52 PM ET (GMT -5) 1 Comments

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Boris Schlossberg

Director of Currency Research, GFT

@import url(/css/cuteeditor.css); Australian Retail Sales missed their mark printing at 0.0% versus 0.3% eyed as consumers kept a tight grip on their wallets in November amidst signs of economic slowdown in Asia. The 25bp rate cut by the RBA had little stimulative impact on Australian economy  as spending on food and household goods remained flat.

This was the third consecutive month that Retail Sales missed their forecast and although the headline number remained positive the rate of growth has come to screeching  halt with consumer spending stalling as growth in the region cools. Some analysts have cautioned that Retail Sales figures may be understating the true strength of consumer demand in Australia given the fact that National accounts figures showed better figures throughout 2011. However, the latest reading clearly  points to deceleration in growth and is likely to spur further rate cut by the RBA in Q1 of this year.

The Aussie tumbled more than half a cent in early Asian trade falling to a low of 1.0155 in the aftermath of the release. The pair is likely to remain under pressure for the rest of the day and may test the 1.0100 handle if risk aversion flows continue into the European session.

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Comments (1)

traderwillie

January 09, 2012 at 07:09 AM ET

Looks to me like the markets may be putting some weight onthe outcome of the Franco-German meeting today between Sarkozy and Merkel. I am also interested to see the outcome of the French bond auction.
traderwillie
www.empowernetwork.com/traderwillie
www.thefxtradingmasters.com

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About The Author

Boris Schlossberg began his Wall Street trading career more than 20 years ago at Drexel Burhnam Lambert. There, he traded nearly every type of financial product on the market in the U.S., from equities and options to stock index futures and foreign exchange. His innate ability to analyze market information and use it to trade has helped him become an industry-recognized, “go to” trading professional.

These days, whenever the markets move, many organizations turn to Schlossberg for his take on the situation. He is a weekly contributor to CNBC's Squawk Box and a regular commentator for Bloomberg radio and television. His daily currency research is widely quoted by Reuters, Dow Jones and Agence France Presse newswires and appears in numerous newspapers worldwide. Schlossberg has written for publications like SFO magazine, Active Trader and Technical Analysis of Stocks and Commodities. He is also the author of Technical Analysis of the Currency Market and the co-author of Millionaire Traders: How Everyday People Are Beating Wall Street at Its Own Game with Kathy Lien. He joined GFT in 2008.