Australia: Weak December not worrying – TDS

Australia published data overnight regarding retail sales and trade balance which missed slightly market expectations, TD Securities reports. AUD/USD fell slightly on the release but then recovered to 0.6745.

Key quotes

“Dec retail sales dropped 0.5% m/m, more than the market forecast of -0.2% m/m, but this follows a very strong Nov, that was revised up from 0.9% m/m to 1% m/m.”

“Q4 Real Retail Sales rose 0.5% q/q, more than we (+0.2%) and the market (+0.3%) were anticipating and was the biggest jump since Q3 2018. The good news was the bounce was led by discretionary spending, a positive in our view.”

“Dec trade saw exports rise 1.4% m/m, but imports increased by a larger 2.4%. This saw the surplus in Dec drop to A$5.2b from A$5.5b in Nov.” 

“The message from NAB's Business Confidence survey for Q4 was that firms do not expect a material turnaround in activity in the near term.”