AUD/USD ignored positive Australian consumer confidence

Australian dollar seemed to ignore the positive signal, submitted by the upbeat Australian consumer confidence data, falling against its US counterpart on Wednesday, as the greenback remained strongly supported by renewed expectations that Fed will begin tapering its bond-purchasing program soon.

AUD/USD slid to its lowest point today at 0.9084 at 5:32 GMT, after which the pair consolidated at 0.9101. Support was likely to be received at August 8th low, 0.8974, while resistance was to be seen at August 12th high, 0.9221.

The Westpac Banking Corporation reported today that its index, gauging consumer confidence in Australia, advanced 3.5% to reach a reading of 105.7 during August, after sliding 0.1% in July. Values above the key level of 100.0 are a signal that the number of optimists exceeds the number of pessimists. Westpac conducted the survey last week, following the 11th consecutive interest rate reduction by the Reserve Bank of Australia. At present the benchmark interest rate is at the record low level of 2.50%, as the central bank is struggling to overcome the possible negative effects by the diminished demand for resources by China.

A separate report showed that Australian wage cost index rose by 0.7% during the second quarter of this year compared to the first, meeting forecasts, after another 0.7% advance in Q1. In annual terms, wage costs showed a slight slow down during Q2, increasing by 2.9%, while in Q1 2013 compared to Q1 2012 wages rose by 3.2%.

In the mean time, the greenback remained continuously supported after on Tuesday the Department of Commerce said that retail sales in the United States rose by 0.2% in July, slowing down in comparison with June’s 0.6% increase, which was a revision up from 0.4% previously. Analysts had projected an increase by 0.3%. Core retail sales, which exclude automobile sales, rose by 0.5% in July compared to June, exceeding expectations of a 0.4% increase, after the revised up sales figure in June, when they increased a mere 0.1%.

Elsewhere, the Aussie was losing ground against the kiwi dollar, as AUD/NZD cross dropped by 0.43% to trade at 1.1399 at 7:49 GMT. In addition, Australian currency was slightly lower against the euro, with EUR/AUD pair up by 0.08% to trade at 1.4570 at 7:50 GMT.