The Australian Dollar slowed down its decline. Overview for 07.03.2019

AUDUSD stopped falling; right now, the pair is consolidating close to its two months lows.

The Australian Dollar quickly stopped falling against the USD on Thursday morning. The current quote for the instrument is 0.7044.

In the morning, Australia reported on the Retail Sales in January. The indicator added 0.1% m/m, which is much worse than expected, +0.3 m/m. On the other hand, it recovered a bit after losing 0.4% m/m in December. 

In response to the statistics, the Aussie stopped falling against the USD and started consolidating. However, the key trigger is not the numbers, but the trade talks between China and the USA.

Based on rather weak numbers published by Australia over the last four months, market players have concerns about possible decrease of the benchmark rate by the Australian regulator. Slowdown in domestic positive momentum, which is reflected in the GDP report and other important macroeconomic indicators, is very unlikely to go unnoticed by the RBA. Relations with China, which are getting worse slowly but steadily, don’t inspire optimism. As a result, the Aussie finds itself under long-term pressure, which go both ways from time to time, but the point is quite clear – the Reserve Bank of Australia will have to reduce the rate sooner or later if the country’s economy can’t handle the pressure on its own.