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When is the Australian Retail Sales and how could they affect AUD/USD?

Early Friday, the market sees November month Retail Sales data from Australia at 00:30 GMT. Considering the “Black Friday” effect, the sales growth is likely to increase to 0.4% from 0.0% disappointment witnessed in October. However, the latest wildfires and uncertainty surrounding the US-China trade deal could weigh on the outcome.

Analysts at Westpac don’t turn down the market forecasts while saying:

The 0.0% monthly headline reading in October was another disappointment given the middle-income tax rebates that came into effect on 1 July, especially with the detail showing spending on discretionary items (e.g. clothing & apparel, household goods and department stores) was negative. Consensus for Nov is 0.4%mth, if only thanks to a rebound from Oct and the growing popularity of “Black Friday” sales which could see Nov benefit at the expense of Dec. Westpac is at 0.3%.

Elsewhere, TD Securities seem following the trend as it says:

Retail sales in Nov should jump thanks to Black Friday promotions. We pencil in a 0.5%/m gain, which is a healthy jump up on the flat m/m outcome for Oct. This would see annual retail sales steady at 2.1%. Despite this promotion driven jump for Nov, the overall trend for retail sales has been weak. Tax cuts are not filtering through to firmer sales, non-food retail is softening and Australian bushfires are likely to see sales remaining soft.

How could it affect AUD/USD?

With the on-going expectations of further rate cuts from the Reserve Bank of Australia (RBA), recently propelled by bushfires in the nation, a downbeat print could join the latest slew of weak Aussie figures and weigh on the AUD/USD pair. On the contrary, figures matching upbeat market consensus might not change investors’ perception concerning the Aussie pair as being the second-tier reading.

Technically, pair’s immediate upside is being capped by a 200-day SMA level near 0.6895, a break of which could propel the pair towards December 24 high near 0.6930. Alternatively, 100-day SMA and lows marked during December 17/18 signal 0.6838/33 area as a near-term key support zone.

Key Notes

AUD/USD keeps it around three-week low to 0.6850 ahead of Aussie Retail Sales

AUD/USD Forecast: At the lower end of its latest range

About Australian 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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