Today’s negative reports had little influence on the Australian and New Zealand Dollars since they were already priced in. Generally speaking, the macro data dating back to February and March is of little relevance at this time.
The Australian and New Zealand Dollars continued to outperform as risk appetite improved on optimism that the spread of the novel coronavirus in the United States and Europe could be tapering, though an outbreak in Japan worsened.
President Donald Trump expressed hope on Sunday that the United States was seeing a “leveling-off” of the coronavirus crisis in some hot spots, but some of his top medical advisors took a more tempered view, Reuters reported.
France’s daily death toll fell in the past 24 hours, Italy reported its lowest daily COVID-19 death toll for more than two weeks on Sunday and Spain’s pace of new deaths slowed for the fourth day on Monday.
Australia Performance of Service Index Slides in March – AIG
The services sector in Australia continued to contract in March and at a much faster rate, the latest survey from the Australian Industry Group revealed on Tuesday with a Performance of Service Index score of 38.7.
That figure is down from 47.0 in February and it moves further beneath the boom-or-bust line of 50 that separates expansion from contraction.
READ MORE : USD/JPY Bulls Are Still Strong
The services sector is now entering a difficult period of pandemic-related closures and adjustments from a base already weakened by summer’s bushfires crisis and by longer-term factors. The index indicated stable conditions in finance & insurance but contractions in the five other sectors in March.Advertisement
Traders Show Little Response to Australian Trade Data
Australia’s trade surplus narrowed to 4,361 million in February from January’s 5,210 million. Exports dropped 5% in February following January’s 3% decline. Meanwhile, imports fell by 4%, having dropped by 3% in January.
Earnings from tourism slid 15% in February, down A$1 billion in just two months. On the other side of the ledger, debits from tourism as Australians went abroad were hardly affected in February. That is likely to have changed markedly in March when borders were closed, offsetting some of the drag from tourist exports.
Australian Job Ads Dive – More Pain Predicted
Australian job advertisements suffered their largest drop in more than a decade in March amid strict social distancing rules and business closures to combat the coronavirus.
Total job ads dived 10.3% in March month-on-month, the steepest decline since January 2009 when the global financial crisis was raging. That left ads averaging 142,504 in March, down a steep 18.2% on the same month last year.
The report from Australia and New Zealand Banking Group (ANZ), released Tuesday, indicated that more pain is likely to come in the labor market as whole sections of the economy shut down.
New Zealand Business Confidence Tanks
New Zealand business confidence fell sharply in the March quarter as firms expected the coronavirus outbreak to reduce demand for their products and impact broader economic activity, a private think tank said on Tuesday.
A net 70% of firms surveyed expected general business conditions to deteriorate, compared with 21% in the previous quarter, the New Zealand Institute of Economic Research’s (NZIER) quarterly survey of business opinion showed.
Today’s negative reports had little influence on the Australian and New Zealand Dollars since they were already priced in. Generally speaking, the macro data dating back to February and March is of little relevance at this time. In New Zealand, the NZIER said responses for the survey closed on March 30, just prior to the NZ government announcing a nationwide lockdown to try to curtail the spread of the coronavirus.