The Aussie Dollar Falls on Weaker Than Expected Retail Sales, Kiwi Rises

“Australia’s dollar snapped a three- day gain after government data showed the nation’s retail sales unexpectedly declined.

The country’s bonds advanced amid speculation the Reserve Bank of Australia will cut interest rates by March to support the economy. New Zealand’s dollar rose against all its major counterparts after data showed building approvals for detached houses surged to the highest in more than two years.

“The Aussie is struggling to rise,” said Satoshi Okagawa, a senior global markets analyst in Singapore at Sumitomo Mitsui Banking Corp., a unit of Japan’s second-biggest financial group by market value. “I can’t see an immediate pickup in corporate confidence or retail sales.”

The Aussie was unchanged at $1.0503 as of 4:55 p.m. in Sydney after rising 0.4 percent in the past three days through yesterday. New Zealand’s currency climbed 0.2 percent to NZ$1.2524 per Australian dollar and rose 0.2 percent to 83.86 U.S. cents.

Australian retail sales fell 0.1 percent in November from the prior month, the Bureau of Statistics said today, while economists estimated a 0.3 percent increase. Job vacancies dropped 6.9 percent the same month, a separate report showed.

The yield on Australia’s three-year note slid four basis points to 2.8 percent. New Zealand’s two-year swap rate was little changed at 2.75 percent.

Traders see a 60 percent likelihood that the RBA will cut its benchmark rate to 2.75 percent or lower by March, according to overnight index swaps data compiled by Bloomberg. The key rate currently stands at 3 percent….”