Following no clear direction from the RBA’s Deputy Governor Guy Debelle, AUD/USD traders will now keep an eye over Australia’s September month jobs report from the Australian Bureau of Statistics at 11:30 Sydney/8:30 Singapore/HK and 00:30 GMT on Thursday. Following mixed readings in August, 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 dovish bias.
Market consensus favors Employment Change to decline to 15.0K from 34.7K on a seasonally adjusted basis whereas no change is anticipated in 5.3% Unemployment Rate of 5.2% and 66.2% Participation Rate.
Westpac also expects a downbeat jobs report as their analysts say:
“Markets continue to price a substantial chance of another RBA rate cut next month, so Australia’s September labour force survey will be very closely watched (11:30 am Syd/8:30am Sing/HK). The median forecast for total employment is +15k (Westpac+17k). If the participation rate holds at a record high 66.2%, the unemployment rate will hold at 5.3% (a 12 month high)."
National Australia Bank (NAB) seem a bit more dovish while saying:
“Ongoing weakness in private demand points to the unemployment edging higher. Employment growth is forecast to slow and NAB expected a 10k gain in September. If unemployment rate rises sooner than we expect, we think that would increase the risk that the RBA cuts the cash rate in November, earlier than NAB's forecast for a December cut to 0.5%.”
How could the data affect AUD/USD?
With the RBA keeping its bearish bias on the table, while also emphasizing the jobs report for the future decisions, today’s data release will be the key to anticipate another rate cut by the Aussie central bank in 2019, which is largely anticipated. While downside readings area mostly expected and could weigh on the Aussie any upbeat surprises will be welcomed with cheers.
Technically, the Aussie pair struggles to extend recovery below 0.6810 near-term key resistance, a break of which could trigger fresh run-up towards 0.6850 and 0.6900. Alternatively, 0.6700 and 0.6670 will entertain sellers during further declines.
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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