Daily Archives: January 11, 2018

Retail Sales data strengthens the Australian Dollar (Daniel Johnson)

Will Retail Sales data continue to be positive?

We recently witnessed a sharp fall in retail sales down under. It was the sharpest fall in four years and alarm bells were ringing. There was a serious problem with housing affordability and wage growth. The housing bubble in Australia is common knowledge with foreign investors willing to pay the inflated house prices. The natives are struggling and are being forced to spend their money on necessities rather than luxury products.

Last month bucked the trend however. We saw a huge rise above the expectations of 0.4% to 1.2% in retail sales. The question is will this growth continue?

I would say the answer to this is sadly no. Having looked into the situation in more detail it looks as though consumers’ obsession with Apple could be the cause along with a spending frenzy on Black Friday. The launch of the iPhone X was the phone that everyone wanted.

If I was an Australian Dollar seller I would be looking to take advantage of current levels. I am of the opinion the data release was an anomaly and I think we will see a sharp fall next month. Take into account that GBP/AUD hit 1.79 recently, so current levels are very favorable.

There is unemployment figures next Thursday and it will be interesting to see if the monster run of form can continue. The last figures were the most impressive since February 2013. I would not however hang on for this release if I was selling the Aussie, a lot can happen in a week.

If you have a currency requirement I would be happy to assist. You need to have an experienced broker on board in order to take advantage of rates when a brief spike occurs, especially in the current climate. If you have a currency provider already in place I am prepared to perform a comparison against them. It will take minutes and could potentially save you hundreds or even thousands of pounds. I can be contacted at  dcj@currencies.co.uk.

Australian Retail Sales help to strengthen the Australian Dollar vs the Pound (Tom Holian)

Australian Retail Sales published overnight came out a lot better than expected with month on month sales measured at 1.2% for the month of November compared to the expectation of 0.4%.

This is a strong indicator of how well the Australian economy is performing and will often have an impact on the RBA’s decision concerning monetary policy.

The rate to buy Australian Dollars with Pounds has fallen from 1.73 during the last few days to the 1.71 levels on the Interbank.

The Australian Dollar has been strengthening during the last few weeks owing to the recent surge in the value of iron ore and as it is such a large revenue generator for the country this is why the currency has strengthened so much since the start of December.

Turning the focus to what is happening globally, the US releases Initial Jobless Claims this afternoon and as the US Federal Reserve have suggested that more interest rate hikes may be coming during 2018 a positive jobs report could see further investment in the US Dollar which could possibly see the Australian Dollar possibly weaken later on today.

Overnight the Chinese release a huge amount of economic data in the form of Import and Export data for December as well as the latest Trade Balance figures.

As China is the largest trading partner with Australia this particular set of economic data will have a big impact on the rate to buy and sell Australian Dollars so make sure you’re prepared.

If you have a currency transfer to make and would like a free quote compared to using your own bank or simply want to compare rates to buy or sell Australian Dollars against your current foreign exchange provider then feel free to get in touch for a free quote. Having worked for one of the UK’s leading currency brokers since 2003 I am confident of being able to help save you money on exchange rates.

Email me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk