Lower Unemployment Rate to Weigh on RBA

AUD

The Aussie dollar opens slightly lower against all majors except for the NZD, driven by the release of negative employment data for the Australian economy yesterday. The Employment Change was expected to be 20.6K, but arrived at 6.7K, although its impact on the Aussie dollar was softened by the Unemployment Rate ticking lower to 3.6%. This was largely due to a fall in the participation rate (the number of people aged 15 or older either in work or actively looking for it), which adds weight to the RBA potentially hiking at their next meeting on November 7. Asian equities followed Wall Street’s lead falling across the board, the Hang Seng leading the way, down -2.5%. The ASX fell -1.4% on the back of Financials’ -1.5% tumble as no sector saw green. Commodities were mixed with Gold closing +1.5%, Silver +0.9% and Crude Oil +2.3%, while in the reds were Iron Ore -1.2% and Natural Gas -1.7%. Today’s focus will be on Chinese 1 and 5 Year Loan Prime Rates data, expected to hold steady at 3.45% and 4.20% respectively. 

USD

The AUDUSD opens lower this morning at 0.6325 after Chairman Powell’s hawkish speech overnight, leaving open the possibility of more rate hikes because of the stronger-than-expected economy, while noting emerging risks and a need to plan carefully. Wall Street also traded lower off the back of his commentary with the Dow -0.6%, and both S&P500 and NASDAQ -0.8%. No meaningful data coming out of the US today, with the exception of FOMC Member Logal speaking at NYC University at 10am, while FOMC Member Harker Speaks at midnight.

EUR

The AUDEUR opens slightly lower this morning at 0.5980, sitting near yesterday’s intraday lows following the AUD’s negative employment data release. European equities closed in the red with the DAX falling -0.3% and CAC -0.5%. No major data coming out of EUR for the rest of this week, but eyes will be on the French and German PMI’s starting Tuesday next week.

GBP 
Like the others, AUDGBP opens slightly lower at 0.5211, despite no data coming out overnight. Out of the Eurozone equities, FTSE was the hardest hit dipping -0.8%. Focus will be on GBP Retail Sales m/m, set to be released tonight at 5:00pm with markets forecasting a decrease to -0.3%.

NZD

The AUDNZD continues to inch higher at 1.0828, following the softer inflation data from earlier this week. There is a tentative RBNZ Statement of Intent at 1:00pm today, which may provide clues as to when they may begin cutting rates. No additional data to be released today.