The Australian Dollar is still under pressure. Overview for 03.09.2018

In the morning, AUDUSD reached new lows, but later managed to start a correction.

On the first Monday of September, the Australian Dollar is still under “bearish” pressure against the USD. The current quote for the instrument is 0.7187.

The statistics published in the morning indicated that the Retail Sales didn’t change in July, although it was expected to add 0.2% m/m after expanding by 0.4% m/m in June. The components of the report show that sales declined for clothing, footwear and personal accessory retailing, department stores, and household goods retailing. Quite the opposite, sales in cafes, restaurants and takeaways, and food improved, thus minimizing an overall decline in the indicator. 

Meanwhile, the AIG Manufacturing Index increased in August up to 56.7 points after being 52.0 points the month before.

This week, investors will be closely watching how things between the USA and China unfolds in their “trade wars”. It really matters for Australia and the Aussie, because China is its major trade and economic partner. The thing that makes investors worry is oncoming extension of import duties on Chinese goods. It’s quite clear why the USA are doing this: Donald Trump is trying to protect the country’s domestic production by creating conditions without competition. By the way, China hasn’t done the same yet.