- EUR AUD rate drops to 1.37 – AUD EUR trades at 0.72
- Eurozone GDP forecasts upset by today’s data – Euro rally fails to materialise today
- Australian Dollar advance follows Westpac confidence score – Close to 100-point score recorded
The Euro has fallen by -0.2% against the Australian Dollar today, in the wake of Australian Westpac consumer confidence figures rising notably in February.
Although fears have been voices that the Australian economy may be turning against the interests of consumers (particularly when it comes to house prices), these concerns have not been enough to push the EUR AUD exchange rate up.
(Last updated February 15th PM, 2017)
Since the slump seen earlier in the day, the Euro has lessened its losses against the Australian Dollar. The Financial Times has reported today that Greece may be bringing in historic financial firm Rothschild to assist in the current debt crisis; this could provide a boost to Greece’s negotiating nous and is the likely cause of recovering confidence in the Euro.
(Last updated February 14th PM, 2017)
While it was widely expected to result in a Euro rally this week, the latest Eurozone data has failed to meet with expectations, leaving the EUR AUD exchange rate negative.
With the second estimates for Q4 GDP growth rates, rises had been forecast on the quarter and the year; the quarterly rate rose but not by as much as expected, while annually no change from 1.7% was seen.
Greek data has also failed to support the Euro against the Australian Dollar, having showed a preliminary GDP slowdown on the year and a return to contraction on the quarter.
The Australian Dollar has rallied all round today, owing to a 4 point jump in January’s NAB business confidence figure.
While a rise from 6 points to 10 seems fairly minor on paper, the also-released business conditions measurement represented the best score since the time of the global financial crisis of the late 2000’s.
NAB Chief Economist Alan Oster stated;
‘This month’s jump in employment conditions bodes well for the generally underperforming labour market, and suggests stronger job creation than we have seen from the ABS in their labour force survey lately’.
It remains to be seen if this optimism will be rewarded with actual rising Australian ecostats. It nonetheless puts the Australian Dollar in a stable position against the Euro going ahead.
December Eurozone trade balance and January Greek Inflation data will be the most important releases tomorrow morning.
The Euro is likely to drop in the near-term as the trade balance is expected to see a surplus reduction and Greek inflation is expected to rise.
While rising inflation may initially be considered good news due to previous periods of sustained deflation, the fact that average monthly salaries have remained down since the 2010-11 period means that further inflationary pressures may be placed on Greek consumers.
Based on this morning’s Australian confidence stats, price pressures on consumers not be an issue for Australian investors tonight when Westpac consumer confidence stats for February are released.
The January figure previously saw a 0.1% rise which equated to a score of 97.4.
Remarks from Reserve Bank of Australia (RBA) official Luci Ellis, who is due to speak at a Housing Researchers Conference, will follow on Wednesday night.
Current EUR AUD Interbank Exchange Rates
At the time of writing, the Euro was trading at a rate of 1.38 against the Australian Dollar while the Australian Dollar was trading at around 0.72 against the Euro.