3 Jul 2013
Flash: RBA hoping for AUD depreciation, despite 10% fall – NAB
FXstreet.com (New York) - The AUD is trading near 0.9140 this morning, its lowest level since September 2010, continuing its losses after a fall from 0.9220 to 0.9160 after yesterday’s RBA decision to keep the cash rate unchanged, notes the NAB Research Team.
RBA hopes AUD will depreciate further
The RBA said that despite the 10% fall in the AUD in the past three months, “it remains at a high level” and the RBA is hoping that it will depreciate further. Regular cuts in interest rates have not managed to boost business confidence and activity, so the RBA is looking for a lower currency to boost the outlook for the economy. On the cash rate outlook, NAB still sees the economy’s under-performance as underwriting another easing, expected later this year unless incoming data, including Q2 CPI, is soft.
Today in Australia, retail sales for May are released and we look for a 0.3% rise, continuing the run of better retail data in early 2013 after the very poor negative outcomes in Q4 2012. Nevertheless, overall growth remains modest and is running at only just above 3% YoY. “For the AUD, a small positive outcome is unlikely to be sufficient to shift the current negative mood.” the team adds.
RBA hopes AUD will depreciate further
The RBA said that despite the 10% fall in the AUD in the past three months, “it remains at a high level” and the RBA is hoping that it will depreciate further. Regular cuts in interest rates have not managed to boost business confidence and activity, so the RBA is looking for a lower currency to boost the outlook for the economy. On the cash rate outlook, NAB still sees the economy’s under-performance as underwriting another easing, expected later this year unless incoming data, including Q2 CPI, is soft.
Today in Australia, retail sales for May are released and we look for a 0.3% rise, continuing the run of better retail data in early 2013 after the very poor negative outcomes in Q4 2012. Nevertheless, overall growth remains modest and is running at only just above 3% YoY. “For the AUD, a small positive outcome is unlikely to be sufficient to shift the current negative mood.” the team adds.