Trade Desk Thoughts - Australia Retail Sales

Australia Retail Sales Actual 0.1%, Expected 0.5%, Previous -1.0%

Release Explanation: Retail Sales is an important measure of consumer spending and inflationary pressures in Australia. Steady increases in retail sales apply significant inflationary pressures to consumer prices. With Retail Trade being the foremost indicator for consumer spending, this figure is extremely important in understanding Australia's economy.

Trade Desk Thoughts: In July 2008, industries that had an increase in trend estimate were food retailing, department stores, and household goods, while clothing and soft good retailing, and cafes, restaurants and takeaway food services had a decline in the trend estimate. The industries that gained are usually the result of necessities while industries that decline do so because consumers are not spending as much of their disposable income on these indulgences.

Forex Technical Reaction: After falling 40 pips from the open, the Australian dollar has spiked up as an initial reaction and is currently sitting at pre-release levels.

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