The Australian dollar was among the main movers through an otherwise lackluster Asian morning, gaining early on a positive consumer sentiment report from Westpac and the Melbourne Institute. The Westpac-Melbourne Institute Consumer Sentiment index rose in November to post the best level since April 2011, the report showed, reflecting the impact of the Reserve Bank of Australia’s cash rate cuts over the past year. The seasonally adjusted index of consumer sentiment rose 5.2% month-on-month in November to 104.3 from 99.2 in October. “This is a welcome and surprisingly strong result. The index has reached its highest level since April 2011. After a long 16-month period when the index held below 100 for 14 of those months we are finally starting to see that the Reserve Bank’s 150bps of interest rate cuts is having an impact,” said Westpac’s economist.
Aussie-dollar was launched off an early $1.0431 low to $1.0445 initially and then extended the gains to $1.0455 in early Asian trading. The pair then ran into rumored option-related selling, and sell orders from various accounts, which subsequently capped the rise. he release of the Australian quarterly wage price index then pulled aussie-dollar back down, with the pair trading at $1.0446 as the Asian morning ended, compared with $1.0435 at the U.S. close last night. Australia’s wage and price index rose at a slower pace than expected as gains for private and public sector workers eased, supporting prospects for a rate cut by the central bank in the coming months. The index, which measures changes in the Australian labor market, rose a seasonally-adjusted 0.7% quarter-on-quarter in the third quarter compared with a 1.0% rise in the second quarter, the Australian Bureau of Statistics said.
EasyForexNews Research Team