Technical Bias: Neutral
- AUDUSD little changed in Sydney’s early session, trading at 0.7946.
- Australia retail sales increased 0.3% in March versus expectations for 0.4% gain.
The AUDUSD continued to trade near one-week highs on Wednesday, as the post-RBA rally faded ahead of Australian retail sales figures.
The AUDUSD was little changed in Sydney’s morning session, trading at 0.7946. The pair climbed 1.3 percent on Tuesday following the Reserve Bank of Australia’s rate statement.
In economic data, retail sales in Australia rose again in March, underscoring the RBA’s optimism that household demand was improving. However, the gain was slightly less than forecast at 0.3 percent following an increase of 0.7 percent in February, the Australian Bureau of Statistics reported on Wednesday. A median estimate of economists forecast a gain of 0.4 percent.
Separately, the Housing Industry Association reported a 4.4 percent increase in new home sales in March, adding to existing concerns about an overheating housing market.
The AUDUSD surged on Tuesday following the Reserve Bank of Australia’s decision to cut interest rates to record lows for the second time this year. The RBA appeared more upbeat about Australia’s prospects, referencing improved household demand and employment.
Price action for the US dollar will resume in the New York session, as payroll processor ADP releases April employment figures. The report is expected to show the creation of 200,000 private jobs in April after job creation slowed to 189,000 in March.