Article by ForexTime

The Australian dollar fell on Thursday after an unexpected drop in Australian retail sales figures. The data added to already bearish sentiment for the aussie after weak GDP data this week.

Retail sales declined 0.1 percent from a month earlier, when they rose a revised 0.6 percent — lower than first reported, government data showed Thursday. The result compares with the median estimate in a Bloomberg survey of 26 economists for a 0.4 percent gain. None predicted a drop.

The Australian dollar slipped to $0.7008, from $0.7040 in early trade, pulling close to a 6-1/2-year low of $0.6982 touched on Wednesday.

Against the yen the Aussie retreated around 0.4 percent to 84.43 yen, showing a loss of more than 3 percent this week.

Investors have been aggressive sellers of the Aussie across the board in recent weeks in large part due to heightened concerns about a hard landing for the Chinese economy.

The latest blow came after retail sales in July fell 0.1 percent from June versus forecasts for a rise of 0.4 percent.

“A lousy retail sales figure only reinforced concerns we had over the Australian consumer after the (GDP data) of yesterday,” said Sean Callow, a senior currency strategist at Westpac Bank. He sees a period of stabilisation ahead for the Aussie as Chinese markets are closed for a public holiday.

Household spending is one of the sectors that the Reserve Bank of Australia (RBA) is relying on to offset the end of mining investments. Data released on Wednesday showed the economy grew 0.2 percent in the second quarter, the slowest pace in more than two years.

Article by ForexTime

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