Jobs data drives AUD lower

Australian Dollar:

Australia’s unemployment rate jumped to a 12-year high in July figures yesterday revealed, sending the official level of joblessness from 6 percent to 6.4 percent, a level not witnessed since the height of the global financial crisis. Whilst the number of full time jobs increased by 14 500, part time employment fell by a staggering 14 800 with a notable jump in the labour force participation rate also further deteriorating the headline number. Triggering substantial falls, the Australian dollar has slumped to an overnight low of 0.9258 when valued against its US Counterpart more than a full cent below its earlier high. Opening this morning at the lower end of its recent trading range the Australian dollar currently buys 92.70 US Cents. In what’s set to be a key driver today investors will be looking towards the RBA’s Monetary Policy Statement which is due be released at 11:30am.  

• We expect a range today of 0.9240 – 0.9310

New Zealand Dollar:

The New Zealand dollar has remained relatively steady overnight, consolidating the losses which were accumulated earlier in the week. Drifting between a low of 0.8451 and a high of 0.8493 when valued against its US Counterpart a flat Greenback mixed with a domestic calendar light on data sees the Kiwi open virtually unchanged at a rate of 0.8475 this morning. In what’s likely to spur heightened price activity today a string of economic prints from China (PPI, CPI, Trade Balance Numbers), should see improved liquidity flows.   

• We expect a range today of 0.8440 – 0.8500

Great British Pound:

Having a very muted impact on broader currency markets overnight the Bank of England in line with expectation kept interest rates at their record of low of 0.5 percent, a level that has been maintained for a period greater than five years. Suggesting the British economy may require ongoing support in the form of enhanced liquidity and low borrowing costs economists are still looking towards a rate hike before years end. Marginally weaker against the Greenback this morning at a rate of 1.6832 the Sterling is also lower against the Kiwi (1.9853) whilst stronger against the Aussie (1.8152)

• We expect a range today of 1.8120 – 1.8190

Majors:

The Euro has weakened in offshore trade after The European Central Bank said that the risks to the Eurozone’s economic recovery have heightened significantly since the onset of geopolitical tensions. Whilst Policy makers opted to keep interest rates at a record low, pledging additional stimulus if and when required, it was the dovish comments from Mario Draghi which inspired the sell-off. Further compounding the woes of the Euro overnight German Industrial figures fell whilst a separate report also confirmed Italy had officially fallen into recession. Tumbling to a low of 1.3336 when valued against its US Counterpart the 18-nation currency presently swaps hands at a rate of 1.3362. On the horizon today investors will be looking towards further monetary policy decisions from Japan followed by a string of key economic releases from China. Steady against the Yen this morning the greenback trades at a rate of 102.079

Data releases

• AUD: RBA Monetary Policy Statement, Home Loans m/m
• NZD: No data today
• JPY: Current Account, Monetary Policy Statement
• GBP: Trade Balance
• EUR: No data today
• USD: Prelim non-farm productivity q/q, Prelim Unit Labour Costs q/q