Australian Dollar has declined against most of its major peers on today; after the factory output data of China came out showing that the Asian powerhouse had the slowest start for a year since 2009. The Chinese data has dampened the overall outlook for the commodity exports of Australia. Against USD, Australian Dollar has now declined for the 2nd straight day. Incidentally, a US retail sales forecast that came out today shows that the biggest economy in the world is improving further.
According to the Chief Economist of St. George Bank, Hans Kunnen, the main reason of Australian Dollar’s decline was a combination of both Chinese and American data. He added that Australian Dollar will be under pressure for the next few weeks.
On today, Australian Dollar declined by 0.2% and is currently priced at $1.0221. The currency has therefore extended the 0.3% drop that it experienced at the end of last week. On the other hand, the New Zealand Dollar, also known as Kiwi, has experienced a slid of 0.3% and is currently trading at 82.00 US Cents. Incidentally, on 8th March, it touched 81.88 Cents, the lowest since 28th December.
The industrial production in China has improved by 9.9% in the initial 2 months of 2013 from where it was in 2012. However, it has failed to match up to the estimated increase of 10.6%. Incidentally, China is the biggest trading partner for both New Zealand and Australia.
When it comes to US, the retail sales are expected to increase by 0.5% in February, marking a fourth consecutive gain for it. On 13th March, the official report is expected to come out.
According to the Commodity Futures Trading Commission reports, future trades have decreased the bets on Australian Dollar’s surge against USD. According to an analyst of the National Australia Bank, negative correlation between the risk appetite and the USD is breaking down even further. If the data this week is not able to rekindle expectations for an early resumption of the interest rate cuts, the Australian Dollar may actually go down below $1.02.
On tomorrow, the most recent business survey will be released by the National Bank of Australia. On the day after, Westpac Banking Corp. will be coming out with a survey on consumer confidence. Incidentally, the gauge of home loans is expected to rebound in January, according to economists.