Forex News

03:41:07 28-03-2023

AUD/JPY corrects to near 87.20 as Australian Retail Sales remain weaker-than-anticipated

  • AUD/JPY has dropped to near 87.20 on poor Australian Retail Sales data.
  • Australian Retail Sales have expanded by 0.2%, lower than the consensus of 0.4% and the former release of 1.9%.
  • BoJ Kuroda might reiterate the continuation of ultra-loose monetary policy to increase wages and the overall demand.

The AUD/JPY pair has slipped to near 87.20 as the Australian Bureau of Statistics has reported weaker Retail Sales data. The economic data has expanded by 0.2%, lower than the consensus of 0.4% and the former release of 1.9%. A weaker-than-expected retail demand indicates that households are facing issues in offsetting the impact of inflated products with the current paying capacity.

The headline might show deteriorating retail demand but is delightful for the Reserve Bank of Australia (RBA), which is working on containing elevated inflation.

This week, the Australian Dollar is expected to remain in the spotlight ahead of the release of the monthly Consumer Price Index (CPI) (Feb) data, which is scheduled for Wednesday. As per the expectations, the inflation data will soften to 7.1% from the former release of 7.4%.

RBA policymakers have already stated that there is evidence, which indicates that Australian inflation has started easing. And, the RBA could terminate its policy-tightening process from April’s monetary meeting as the current monetary policy is restrictive enough to tame the stubborn inflation.

Apart from that, China’s Manufacturing PMI by the National Bureau of Statistics (NBS) will be the key trigger for the Australian Dollar. The Chinese economy is focused on the path of economic recovery after dismantling pandemic controls. Therefore, a decent performance is expected in the scale of manufacturing activities. It is worth noting that Australia is the leading trading partner of China and a higher Chinese PMI will also strengthen the Australian Dollar.

On the Tokyo front the speech from Bank of Japan (BoJ) ex-Governor Haruhiko Kuroda will remain in focus. BoJ Kuroda might reiterate the continuation of ultra-loose monetary policy to increase wages and the overall demand in the Japanese economy.

 

News provided by the portal FXStreet
Contacts
Close
Up