Early Thursday markets will see Australian Bureau of Statistics releasing Aussie employment data for August at 11:30 Sydney/9:30 Singapore/HK and 01:30 GMT. Following upbeat readings in July, markets will keep a close eye on the employment data to better foresee future policy moves by the Reserve Bank of Australia (RBA) considering its emphasis on the unemployment rate and the recently dovish meeting minutes.
Market consensus favors Employment Change to decline 41.1K to 10.0K on a seasonally adjusted basis whereas a rise to 5.3% is anticipated in the Unemployment Rate of 5.2%. Further, no change is expected as far as the Participation Rate of 66.1% is concerned.
TD Securities anticipate upside risk to the unemployment rate as their latest report says:
“TD expects the unemployment rate and participation to remain steady at 5.2% and 66.1% respectively in Aug with 24.6k jobs to be added in the month. The focus will be on the unemployment rate and we view the risk to our forecast is to the upside. A 5.3% print and a poor headline print would make an Oct cut a 50/50 proposition.”
Westpac also expects a downbeat jobs report as their analysts say:
“Jobs growth has beaten consensus in 4 of the past 5 months, including a steep 41k gain in July. We look for a correction in August, just +7k (median +15k). This would trim annual jobs growth to 2.3%yr (US payrolls are up 1.4%yr). If the participation rate holds at a record high 66.1%, the unemployment rate should nudge up to 5.3% (median 5.2%).”
How could the data affect AUD/USD?
The RBA is considered more dovish in its latest media releases and has also emphasized on the unemployment rate for future policy moves. As a result, disappointment from the employment numbers could drag the AUD/USD further towards the south. On the contrary, upbeat releases, like the recent job outcomes, might not please Aussie buyers for long amid the RBA’s overall dovish outlook.
Technically, 0.6825/20 area comprising August month high and 21-day exponential moving average (EMA) can keep restricting the pair’s near-term declines, a break of which could recall 0.6800 and month-start tops near 0.6740. Alternatively, 50-day EMA level of 0.6845 and 0.6895/0.6900 area, including monthly top and 100-day EMA, can limit the pair’s immediate advances.
Key Notes
AUD/USD bounces off 21-day EMA ahead of Australia jobs report
AUD/USD Analysis: weakening ahead of AU employment
About the Employment Change
The Employment Change released by the Australian Bureau of Statistics is a measure of the change in the number of employed people in Australia. Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth. Therefore, a high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or bearish).
About the Unemployment Rate
The Unemployment Rate release by the Australian Bureau of Statistics is the number of unemployed workers divided by the total civilian labor force. If the rate hikes, indicates a lack of expansion within the Australian labor market. As a result, a rise leads to weaken the Australian economy. A decrease of the figure is seen as positive (or bullish) for the AUD, while an increase is seen as negative (or bearish).
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