Australia data shows signs of stabilization
09/09/08 23:09
Australian data released yesterday showed some signs
of stabilization in the economy. Monthly retail trade
jumped 1.4% in July (UBSe. 0.8%m/m, cons. 0.5% m/m)
and the NAB business conditions in August rose
slightly to -3 from -5. Total housing lending in July
also rose by0.6%, after 5 consecutive monthly
declines totaling more than 23%.
The data showed some stabilization in the economy
after weakness but does not signal a change in
direction. The data is consistent with a soft landing
in the economy and explain why the RBA remains
cautious in communicating a desire for lower rates.
It's possible AUD has been oversold and that RBA
Governor Glenn Stevens played down the scope for rate
cuts at his semi-annual testimony to Parliament on
Monday, Sept 8. We need to watch AUD closely into the
RBNZ meeting on Thursday.
I remain bearish the AUDJPY pair as the strength of risk aversion is overriding any AUD price stability and it may have another 3-5% further to go, but who knows, in this market as some of the crosses remain vulnerable to scrambling of Monetary Policy Makers across the globe. BTW, do any of you believe in Paulson's statement that "the taxpayer will be paid back"? The statement was made following the Treasury's decision to bail out Fannie May and Freddie Mac, which was a necessary move to protect the financial system, but the struggle to achieve price stability in the financial markets will remain a task.
As a result, US Treasury credit default swaps widened to a record level yesterday. Has anybody found financing for the wealthy genius' at Lehman brothers? This will continue to weigh on the financial sector as more bank woes are revealed and the rats are shaken out. UK will suffer due to the scale of the financial activity in the region.
Good Luck with your trading and be careful out there!
Chris Lori
I remain bearish the AUDJPY pair as the strength of risk aversion is overriding any AUD price stability and it may have another 3-5% further to go, but who knows, in this market as some of the crosses remain vulnerable to scrambling of Monetary Policy Makers across the globe. BTW, do any of you believe in Paulson's statement that "the taxpayer will be paid back"? The statement was made following the Treasury's decision to bail out Fannie May and Freddie Mac, which was a necessary move to protect the financial system, but the struggle to achieve price stability in the financial markets will remain a task.
As a result, US Treasury credit default swaps widened to a record level yesterday. Has anybody found financing for the wealthy genius' at Lehman brothers? This will continue to weigh on the financial sector as more bank woes are revealed and the rats are shaken out. UK will suffer due to the scale of the financial activity in the region.
Good Luck with your trading and be careful out there!
Chris Lori