Australian dollar coin
A one Australian dollar coin is seen in this picture illustration taken in Sydney, Australia, July 29, 2015. Reuters/David Gray

Bell FX Currency Outlook: The Australian Dollar has opened this week of trading below the .7300 level as we await the
latest GDP figures from China early this afternoon.

Australia: The AUD slipped in trading on Friday as financial markets concentrated on a better than anticipated consumer sentiment survey in the US and the slim possibility that the RBA may lower interest rates after last week’s decision by Westpac to raise home loan rates by 20bps. We believe this will not occur and the RBA will wait to see how the data looks over the coming months before moving the 2% cash rate. Tomorrow the recent minutes from the October RBA meeting will be released. At 1pm today AEDT the GDP figures for Q3 for China will be announced along with September’s industrial production and retail sales figures. Most analysts are predicting a decline in GDP growth from 7% to 6.8%. Depending upon the level of expansion announced, the AUD could be volatile.

Majors: The latest consumer sentiment survey from the University of Michigan revealed an increase of 4.9 to 92.1, reversing the decline of last month. Industrial production declined 0.2% in September which was in line with predictions while August data was revised upward by a decline of only 0.1% from the previous figure of -0.4%. The manufacturing sector saw a decline of 0.1% mom versus the gain of 0.2% that was expected. US job openings fell to 3.6% from 3.9% in August indicating continued good momentum in the labour market. The financial markets continue to predict a US rate rise will occur in July, 2016 although most analysts believe US Federal Reserve Chairwoman Janet Yellen will reiterate that a rate rise is still possible sometime in 2015 when she speaks on Wednesday. Over the weekend Bank of England member Forbes said that she expected the next move in the UK interest rates would be up. Attention later in the week will focus on Thursday’s ECB meeting where further clues about more QE may be revealed.

Economic Calendar 19 OCT

  • CH Retail Sales Sep
  • CH Industrial Production Sep
  • CH GDP 3Q
  • US Housing Market Index Oct

Bell FX

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