Aussie Trade Balance Overview
Wednesday brings a pair of key data releases for the Aussie, with Australia’s Trade Balance and seasonally-adjusted Retail Sales due at 01:30 GMT. The Aussie Trade Balance is expected to come in at $1.2 billion (last $997 million), while Retail Sales for May are expected to decline slightly, forecast at 0.3% (last 0.4%). A mixed release could see the Aussie lose confidence for Wednesday, and as analysts from TD Securities noted, the spread result may come in worse than market expectations: “buoyant iron ore prices and volumes more recently suggest a bigger surplus for June is likely. For retail sales, warm weather generated the surprise bump in April (+0.4%/m) so we look for a smaller +0.2%/m lift for a milder May”.
How could it affect the AUD/USD?
Mixed data releases have been the thing keeping the Reserve Bank of Australia (RBA) frozen in place on rates, and a continued spreading of good and bad releases could see the AUD begin to slip back against the USD. A bullish reading, on the other hand, is exactly what Aussi bulls need to begin pushing the pair back over Tuesday’s high at 0.7404, while a worse-than-expected showing for both figures will see the bearish trend resume, dragging the AUD/USD down into 2018’s lows at 0.7310.
Key notes
AUD/USD analysis: recovery stalled below key resistance
Trading the Aussie with Australia Trade Balance
About the Aussie Trade Balance
The trade balance released by the Australian Bureau of Statistics is the difference in the value of its imports and exports of Australian goods. Export data can give an important reflection of Australian growth, while imports provide an indication of domestic demand. Trade Balance gives an early indication of the net export performance. If a steady demand in exchange for Australian exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.
About the Aussie Retail Sales
The Retail Sales released by the Australian Bureau of Statistics is a survey of goods sold by retailers is based on a sampling of retail stores of different types and sizes and it”s considered as an indicator of the pace of the Australian economy. It shows the performance of the retail sector over the short and mid-term. Positive economic growth anticipates bullish trends for the AUD, while a low reading is seen as negative or bearish.
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