Forex Special
The Asian pacific witnessed a quiet week excluding the Australian economy, which released many critical data, in addition to the Reserve Bank of Australia that held rates steady to support the economy. Also Asian stock markets witnessed heavy fluctuations due to companies' earnings, which proved that the Asian companies are resilient in face of the global imbalances so far.
The Reserve Bank of Australia last week decided to keep the borrowing costs unchanged for the third consecutive month at 4.50%, meaning the economy rebound is not stoking inflation.
Mr. Stevens returned borrowing cost to their average levels after the past series of hikes, raised six times during seven meetings since early October.
Consumer price index declined during last quarter, which supported policy makers of the RBA and Mr. Stevens's scope to hold interest rates.
Australian seasonally adjusted retail sales advanced 0.2% during June, inline with the previous; they came lower than estimates for 0.4%. Retail sales excluding inflation inclined 0.8% in the second quarter of the year, compared with a prior 0.1% during the 1st quarter, while the analysts' expectations referred to 0.7%.
The report showed that consumers spent 1.2% less on shoes and clothing stores. Spending on household good rose 1.3% in June, while restaurant purchases climbed 0.6%.
Also the Australian trade surplus widened to $A3539 million during June, rising from the previous $A1645 million in May, which was revised to A$1825 million.
Rising exports is the main reason behind the cheerful report, and exports are the main pillar for the economy, which rose during June as the demand for iron ore and coal surged. The report showed iron ore exports exceeding higher imports of clothing and capital goods which boosted the surplus in June.
As for the New Zealand economy, unemployment rate rose to 6.8 in the second quarter of this year compared with a previous 6.0%, and higher than analyst's estimates of 6.4%.
On the other side, the nation's exporting sector remains weak pressuring companies to delay expansion plans and cut costs through increasing layoffs, that was reflected on the labor market and on consumer spending.
