By Orbex
In the context of covid, the world’s attention seems to be in Australia, specifically on tennis star Djokovic’s inability to enter the country.
Famously, Australia had managed to keep the virus from spreading locally for an extended period of time. But, the arrival of omicron has definitely put that to an end. In fact, covid cases are pushing above 1 million in the last couple of days.
Also, Australia was famous for its draconian measures to combat the spread of the delta variant throughout their most recent winter season.
At the time, Australia had a relatively low vaccination rate. Nonetheless, at the latest count, up to 77% of Australians have received a double dose of the vaccine. Despite the massive increase in cases, and hospitalizations returning to the levels seen in the middle of the delta outbreak, government officials aren’t eager to reimpose covid restrictions.
That said, a few days ago, PM Morrison said that it’s necessary to restructure policy.
Free Reports:
Download Our Metatrader 4 Indicators – Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter
Get our Weekly Commitment of Traders Reports - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.
The data is still relevant
In a fast-evolving situation due to omicron, November retail sales data might not have as much impact on the markets. However, should state premiers, in particular, decide to not return to lockdowns, then the trajectory of the services sector recovery would likely be much more relevant.
Australia had recorded three consecutive months of improving retail sales. This suggests that Australian consumers were lining up with the expectation of a fast recovery. Nevertheless, a slow down in growth at the end of the year was predictable, as the comparable data is better.
What to look out for
Analysts project that Australia’s November Retail Sales will come in at 3.9%, below the 4.9% recorded in October. The pace is well above pre-pandemic levels. In turn, this implies that the retail sector was still in recovery mode as they approached the normally more active summer months.
On the one hand, a significant miss in projections from data even before the latest outbreak could concern traders. And this opens the possibility of a downside risk in the data. On the other hand, traders could dismiss a significant beat in the data. That is because the data is from before the latest covid outbreak.
Where things are going
Previously, some of the harshest measures were applied at Victoria state during the last surge. So far though, Victoria state has not announced any major changes to their covid response policy beyond technical measures such as cancelling elective surgeries. Perhaps that’s because cases haven’t peaked yet. Therefore, there still is a possibility of new lockdown measures being implemented.
Foreign investment in the country and travel are likely to remain muted until case numbers peak. This suggests increased pressure on the AUD. Australia’s exports have increased lately, but at lower prices. And this could potentially imply less demand for the local currency.
Article by Orbex
Orbex is a fully licensed broker that was established in 2011. Founded with a mission to serve its traders responsibly and provides traders with access to the world’s largest and most liquid financial markets. www.orbex.com
- COT Bonds Charts: Speculator Weekly Changes led by 5-Year & 10-Year Bonds Apr 28, 2024
- COT Stock Market Charts: Speculator Bets led by VIX & Russell-Mini Apr 28, 2024
- COT Soft Commodities Charts: Speculator Bets led by Corn & Soybean Meal Apr 28, 2024
- Today, investors’ focus is on the PCE Price Index inflation report Apr 26, 2024
- Gold price recovers amid uncertain US economic outlook Apr 26, 2024
- This “Bullish Buzz” Reaches Highest Level in 53 Years Apr 26, 2024
- FastSpring and EBANX Forge Partnership to Expand Pix Payments for Digital Products in Brazil Apr 25, 2024
- Target Thursdays: NAS100, Robusta Coffee, USDCHF Apr 25, 2024
- QCOM wants to create competition in the AI chip market. Hong Kong index hits five-month high Apr 25, 2024
- Japanese yen hits all-time low as BoJ meeting commences Apr 25, 2024