Solid US Retail Sales Underscore Economy's Resilience
AUD
The Aussie Dollar starts the week mixed against major currencies, being flat on the US Dollar and Euro, higher against the Pound and lower against the Kiwi Dollar. This comes after minimal macroeconomic data and geopolitical developments were seen over the weekend. Asian equities ended the week mixed, the Nikkei +0.3%, the Hang Seng -0.1%, Shanghai Comp -1.5% and the Shenzhen -1.8%. Locally, the ASX gained +0.7%, buoyed by utilities and financials. Commodities on the other hand closed all in the red with Gold -0.4%, Silver -0.9%, Iron Ore and Copper both -0.7%. It will be a pretty quiet week for domestic data events. Today, RBA Assistant Governor Kent will be speaking at 5:30pm. RBA Governor Bullock will be speaking on Thursday night. We however will get some data out of China that may cause some volatility with their 1-y and 5-y Loan prime Rate releases on Wednesday at noon with both expected to remain the same at 3.10%, and 3.60% respectively.
USD
The AUDUSD coupling opens flat at 0.6457 despite US Retail Sales posting solid gains in October as Americans show continued willingness to spend. Retail Sales rose +0.4% from September to October, a solid increase though less than the previous +0.8% gain. The latest figures suggest that the economy is growing briskly again in the current quarter, having also expanded in the previous quarter. The Empire State Manufacturing Index also showed business activity grew strongly in New York State in November, shooting up to 31.2 its highest reading in nearly three years. These decent US trends leave the possibility of a December rate cut in balance with the jobs report likely the key deciver in the fist week of December. Wall Street closed in the red with the Dow Jones -0.7%, S&P 500 -1.3%, and the Nasdaq -2.2%. No major US data set for release overnight or this week, with only FOMC Member Goolsbee Speaking and the NAHB Housing Market Index early tomorrow morning at 2am, and the next major release being Unemployment Claims early Friday morning.
EUR
AUDEUR opens flat at 0.6134 with minimal data released over the past few days. Eurozone equities all closed lower on Friday with the DAX -0.3% and the CAC -0.6%. Tonight, there will be some minor data with German Buba President Nagel speaking and the Eurozone Trade Balance set for release. All eyes will be focused to this Friday evening with the Eurozone Flash Manufacturing and Services PMI’s which are all forecasted to either increase or remain the same, we will also hear from ECB President Lagarde on Friday.
GBP
The AUDGBP regains the 0.51 handle, opening higher to start of the week at 0.5102 after the NIESR GDP Estimate presented monthly GDP falling by 0.1 per cent in September, following 0.2 per cent growth in August. UK equities closed in the red with the FTSE -0.1%. Today, we will see the Rightmove HPI m/m release later this morning at 11am. The main events of the week will be the CPI y/y release on Wednesday evening with CPI y/y forecasted to increase from 1.7% to 2.2%, followed by UK’s Flash Manufacturing and Services PMI’s late Friday evening.
NZD
AUDNZD opens slightly lower to start off the week at 1.1012 with this morning's BusinessNZ Services Index printed at 46.0 this morning, up from 45.7, meaning the NZ services is still contracting, although at a slower pace. PPI Input q/q, and PPI Output q/q both increased and outperformed forecasts at 1.9%, and 1.5% respectively. No further releases set for today, with the next set of data to focus on being Credit Card Spending on Thursday.