CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

AU Q1 2022 GDP beats forecasts and frames further gains for AUDNZD

June 1, 2022 3:30 AM

As the release of the final partials yesterday warned, Australian Q1 2022 Australian GDP has beaten expectations, rising by a solid 0.8% QoQ and 3.3% YoY, despite the impact of Omicron and the devastating rains and floods that hit the East Coast.

Within the details, Australia's Terms of Trade rose 5.9%, with export (+9.6%) and import prices (+3.5%) up strongly. Rises in energy-related export prices drove the gains.

Domestic final demand contributed 1.6% to GDP growth. Household final consumption expenditure contributed 0.8%. Government consumption contributed 0.6%, driven by increased health expenditure. The government's response to the floods in NSW and QLD also contributed to the rise.

Net trade was the main drag falling by 1.7%, driven by the most robust rise in imports since the December quarter of 2009. The increase in imports reflected delayed shipments' arrival and rebuilding inventory by businesses closer to pre-pandemic levels.

Changes in inventories contributed 1% and partly offset the detraction from imports and likely reflect rebuilding from depressed Covid-19 levels and strong demand.

The household saving ratio declined from 13.4% to 11.4%, remaining above pre-pandemic levels but a long way from the 19.8% level it reached in Q3 2021. The fall in the savings rate as consumers continue to open their wallets and shop up a storm and the rising cost of living.

Given the continued surge in energy prices and the Terms of Trade, and the fact that growth has remained resilient in the face of firm headwinds, it should be enough to see the RBA hike rates by 40 bp next week to 0.75%.

To take advantage of the factors outlined above and to take the choppy U.S dollar out of the equation, we favour buying AUDNZD here around the 1.1015 area, with a stop loss placed at 1.0915. The target for the trade would be 1.1170/1.1200.

Source Tradingview. The figures stated are as of May 1st of June 2022. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation

How to trade with City Index

You can trade with City Index by following these four easy steps:

  1. Open an account, or log in if you’re already a customer 

    • Open an account in the UK
    • Open an account in Australia
    • Open an account in Singapore

  2. Search for the company you want to trade in our award-winning platform 
  3. Choose your position and size, and your stop and limit levels 
  4. Place the trade

 

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024