Positive GDP failed to boost Aussie and ASX200

• The Australian dollar failed to further gain ground after yesterday's sharp rise as Reserve Bank of Australia (RBA) kept the policy rates unchanged. Despite yesterday's sharp gain outlook for Australian dollar look bleak unless broad based dollar weakness move the pair above.

• Aussie is currently trading at 0.782 against the dollar unimpressed. Australian benchmark stock index fell to 5901, down 0.5 percent for the day.

• Question arises, when the global growth is down why isn't the 2.5 percent positive growth is being cheered?

Analogy -

• The mining investment boom and China's continued double digit growth that has helped the economy over the last decade continue to falter.

• GDP grew 0.5 per cent in the fourth quarter and rate was 2.5 per cent.

• Along with China, the Australian economy grew for last 25 years without even a recession. This could change soon as the price of its export products namely coal, LNG, iron ore continue to fall and new investments are put to shelf.

• Despite the positive GDP, Jobless rate has moved to 6.4 percent, a 12 year high. Terms of trade has further deteriorated by 1.7 percent in fourth quarter. Public investment fell 0.9 per cent in the quarter and is down 11.9 percent YoY.

• Economist's prediction of further reduction in mining investment by at least another 10 percent and growth reduction to 1.8 percent in 2015 mean further pain ahead.

Expectations -

• RBA is expected to continue the easing cycle that would help the stock market to keep buoyant.

• Australian dollar to continue to falter as further headwinds from strong dollar start appearing later this year.