When is Australia Retail Sales and how could it affect AUD/USD?

Retail Sales Overview

Early Tuesday, the market sees preliminary readings of Australia's seasonally adjusted Retail Sales for December month at 00:30 GMT. Market consensus suggests a stronger seasonally adjusted MoM print of 1.4% versus -3.9% prior, suggesting a sustained improvement in economic activity.

Given the recently stronger Aussie inflation data and the upbeat comments from the Reserve Bank of Australia's (RBA) officials, not to forget the challenges to sentiment ahead of the month-end consolidation, today’s Aussie Retail Sales appear crucial for the AUD/USD traders.

It should be noted that China’s official NBS Manufacturing PMI and Non-Manufacturing PMI, up for publishing around 01:00 AM GMT on Wednesday, also increases the importance of the Asia-Pacific economic calendar on Tuesday.

Ahead of the data, Westpac said,

An underlying slowdown in retail sales should continue to be evident in January despite recent volatility (Westpac f/c: 1.0%mth, median forecast 1.5%, after December’s shock -3.9%). 

How could it affect AUD/USD?

AUD/USD struggles to defend the week-start recovery while portraying the pre-data anxiety around 0.6740 by the press time. The Aussie pair’s inaction could also be linked to the mixed headlines surrounding China. As the US White House braces for easy China-linked policies for investments, per Politico, while also keeping the Dragon nation on radar for its alleged role in the Ukraine-Russia tension.

That said, the likely easy economics from Australia and China may add losses to the AUD/USD prices amid recently sluggish sentiment and doubts over the RBA’s next move, despite firmer inflation data. It’s worth noting, however, that a strong print will join the upbeat Aussie Consumer Price Index (CPI) figures and could enable the Aussie pair to better position for this week’s volatile session.

Technically, a one-month-old bullish channel restricts AUD/USD pair’s downside near the 0.7000 round figure.

Key Notes

AUD/USD faces barricades around 0.6750 ahead of Australian GDP and US PMI data

AUD/USD Forecast: Australian data will set the next direction

About Australian Retail Sales

The Retail Sales released by the Australian Bureau of Statistics is a survey of goods sold by retailers based on a sampling of retail stores of different types and sizes and it's considered an indicator of the pace of the Australian economy. It shows the performance of the retail sector over the short and mid-term. Positive economic growth anticipates bullish trends for the AUD, while a low reading is seen as negative or bearish.