The Australian Dollar Fell Regardless of Solid Retail Sales

The Australian Dollar Fell Regardless of Solid Retail Sales

On Friday, May 21, the Australian dollar fell, surrendering most of its clinch made last Thursday, and it has been a rollercoaster ride for the Aussie currency. The AUD/USD plunged 0.25% to 0.7756.

Meanwhile, retail sales, which trace consumer demand for finished products by quantifying the purchase of durable and non-durable items over a settled period of time, spiked 1.10%, surpassing the 0.50% forecast. It marked the third consecutive month that retail sales have gone beyond the 1.00% level. Besides, it points to the stable growth in consumer spending, which is the main factor of economic activity.

Another positive report stated that there is growth in the nation’s Purchasing Managers’ Index (PMI), which is the basket of the existing direction of economic trends in the manufacturing and service sector. The manufacturing PMI data was released at 59.9, and the services at 58.2. The neutral 50-level divides contraction from expansion.

A surge in overseas demand for Australian exports has raised manufacturing, and robust domestic activity has carried business and services. The country has materialized from the coronavirus pandemic in good shape, and major economic indicators keep on going forward. Regardless of the positive statistics, the Aussie currency wasn’t able to enslave.

In comparison to the U.S. Dollar, it has its issue as inflation concerns have subsided, and it made the greenback less captivating. The Philadelphia Federal Index sank to 30.1, which sharply crashed from the previous 50.1.

Other Currencies List of Mixed Movement

The Dollar Index, which traces the greenback in opposition to the basket of six other currencies list, plummeted 0.1% at 89.737, which fell by about 0.6% so far this week.

The EUR/USD pair rose 0.1% at 1.2237, not far under the four-month spike of 1.2245 that it hit recently, while USD/JPY plunged 0.1% at 108.71.

In addition, GBP/USD eased 0.1% to 1.4182, just short of its multi-year soars, after British retail sales were boosted by 9.2% in April when non-essential stores resumed after months of shutdown due to COVID-19 curbs. This is their highest jump since an earlier reopening last June.

Elsewhere, USD/ZAR advanced 0.1% at 13.979, succeeding South Africa’s central bank shutting its benchmark interest rate for a fifth consecutive meeting.