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Forex - Aussie weaker on flat retail sales figures

Published 04/03/2016, 11:01 PM
Updated 04/03/2016, 11:04 PM
Aussie weaker on retail sales
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Investing.com - The Aussie fell in Asia on Monday as retail sales and other data disappointed, while the euro shrugged off friction between the Greek government and the IMF.

AUD/USD traded at 0.7643, down 0.49%, while USD/JPY changed hands at 111.55, down 0.14%. EUR/USD traded at 1.1399, up 0.09%.

In Australia the MI inflation gauge for March was flat after a 0.2% month-on-month fall in February.

Also in Australia building approvals for February jumped 3.1%, compared with a 2.0% gain seen month-on-month.

As well private house approvals dipped 1.2% in February, compared with a revised downward fall of 6.4% in January and retail sales were flat compared to a 0.4% month-on-month gain seen in February.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.02% at 94.56.

In the week ahead, investors will be focusing on Wednesday’s minutes of the Fed’s March meeting for fresh insights on how officials view the economic outlook.

The U.S. is also to release economic reports on trade, manufacturing and service sector activity. A central bank meeting in Australia will also be in focus.
On Monday, markets in Hong Kong and Shanghai will be closed for holidays.

The euro zone is to report on the unemployment rate and the U.K. is to release survey data on construction sector activity. The U.S. is to publish data on factory orders.

Last week, the dollar ended the week close to five-month lows against a basket of the other major currencies on Friday as investors bet that a stronger-than-expected U.S. jobs report would not prompt the Federal Reserve to raise interest rates more quickly.

The Labor Department reported that the U.S. economy added 215,000 jobs last month, ahead of economists’ expectations for jobs growth of 205,000.

The unemployment rate ticked up to 5% from an eight-year low of 4.9% as more people entered the labor market. Average hourly earnings rose by seven cents last month after falling two cents in February.

A separate report showed that U.S. manufacturing activity expanded in March for the first time in six months as new orders rose.

The Institute for Supply Management said its manufacturing index rose to 51.8 from 49.5 in February.

But the upbeat data did little to alter expectations that the Fed will remain cautious about hiking interest rates this year.

Earlier in the week Fed Chair Janet Yellen said global risks to the U.S. economy, including low oil prices and uncertainty over China justified taking a cautious approach to tightening monetary policy. Lower interest rates make the dollar less attractive to yield seeking investors.

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