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Australian retail sales, trade balance eyed - Westpac

FXStreet (Bali) - Sean Callow, FX Strategist at Westpac, shares his view for the Australian risk events coming up, which include retail sales and trade balance, as well as the BoJ monetary policy.

Key Quotes

"Australia’s crowded data week continues at 11:30am Syd/9:30am Sing/HK with July retail sales and trade balance. AUD is normally most focused on retail trade, which we see growing modestly, up 0.3% m/m vs median 0.4%. Consumer sentiment has improved from the May lows but remains below average. June saw a 0.6% rebound from the -0.3% contraction in May, which looks to have been linked to unusually mild weather as well as the federal budget. But caution should be used with this survey as it accounts for only about 40% of consumer spending: witness the contrast between the -0.2% q/q on real retail sales in Q2 and the national accounts’ 0.5% q/q rise in household consumption."

"Australia’s recent trade blowout should ease in July, from –AUD1.7bn to -1.2bn. This assumes a 2% m/m rise in exports, driven by increased iron ore and coal shipments outweighing soft prices, plus a roughly flat reading on imports (we have already seen goods imports +0.1%). This series is prone to surprise, reflected in the wide range of forecasts from -0.2bn to -2.5bn though most are in the -1.1bn to -1.9bn range."

"The Bank of Japan policy meeting concludes today, with a decision usually released within say 12:30pm-1:30pm Syd/10:30-11:30am Sing/HK. A steady hand is assured and it is doubtful that Governor Kuroda will change his tune noticeably in the press conference at 4:30pm Syd/2:30pm Sing/HK, despite a poor run of data."

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