News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • It’s important for traders to be familiar with FX spreads as they are the primary cost of trading currencies. Understand a pair's spread here: https://t.co/zEEUHZBx7g https://t.co/ShcIhbvB3p
  • If all these new demands get incorporated in the final package, the legislation's price tag will drop significantly. We could be looking at something close to $1.5 trillion or even less $USD $XAUUSD https://t.co/xJtlAECDFD
  • *Reminder: Weekly Strategy Webinar Tomorrow Morning at 8:30am ET on DailyFX! https://t.co/lxd5fZnn4H
  • According to GS, S&P 500 daily returns are positively correlated with flows. Over the last 3 months, flows have been strong, but the $SPX was flat (model predicted a 7% rally). When SPX returns and flows deviate, they tend to mean-revert in subsequent periods #trading https://t.co/2JbZV2dbAa
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here: https://t.co/IsnpfJhp91 https://t.co/tWwIzXWwj3
  • Further your forex knowledge and gain insights from our expert analysts @ddubrovskyFX and @FxWestwater on JPY with our free Q4 market analysis guide, available for free today.https://t.co/mzeJ5x73N3 https://t.co/lDBYbDLQtZ
  • How does stock market liquidity benefit its traders? Learn more here: https://t.co/FWKyIDUwAw https://t.co/tyoYrsh8mQ
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/4078fnQJON
  • Looking for a new way to trade reversals? One of the most used reversal candle patterns is known as the Harami. Like most candlestick formation patterns, the Harami tells a story about sentiment in the market. Get better with trading reversals here: https://t.co/kIIBffEMi7 https://t.co/tt59BU8lnS
  • Quarterly earnings from Netflix and Tesla, two big tech companies, will take center stage next week and could set the trading tone for the S&P 500 and the Nasdaq 100. Get your weekly equities forecast from @DColmanFX here: https://t.co/NOCqjJ3TLd https://t.co/HR5xUZeJXp
Australian Dollar Dips. Unemployment Ticks Up But Full Time Jobs Roar Back

Australian Dollar Dips. Unemployment Ticks Up But Full Time Jobs Roar Back

David Cottle, Analyst

Australian Dollar, Official Employment Data, Talking Points:

  • January’s unemployment rate rose ahead of expectations
  • This blunted the impact of strong full-time job creation
  • The report was very mixed, but that rate rise will weigh at the Reserve Bank of Australia

The Australian Dollar lost a little ground Thursday as the unemployment rate ticked up in an official labor market report that was far from wholly gloomy.

January’s rate was 5.3%, a four-month high and a reversal of the declining trend seen since October 2019.

However, full time employment grew by an impressive 46,200, while part time jobs were down by 32,700 for an overall jobs gain of 13,500. That was ahead of market expectations, which looked for a 10,000 rise, and the overall participation rate was up as well. However, that rise in the overall unemployment rate is likely to weigh on thinking at the Reserve Bank of Australia. It hopes to see a decline to 4.5% over the next two years, and any sign that thinks are going the other way will inevitably mean the market sees lower interest rates and for longer.

This was reflected in AUD/USD’s immediate reaction, although the market clearly became a little more sanguine once the report’s details had been reviewed.

Australian Dollar, 5-Minute Chart

The previous month’s data saw a big surge in job creation but all of it was accounted for by part-time rolls. Full time employment slipped, robbing the strong headline figure of some impact. January’s data are almost a mirror image.

The Reserve Bank of Australia is watching this series very closely, hoping that a tighter labor market will lead to stronger wage growth and consumption. This is a key missing part of the inflation mosaic and a primary reason why prices remain relatively subdued.

As a primary growth-correlated currency, the Australian Dollar has been hard hit this young new year by the general withdrawal from risk that has accompanied the spread of Wuhan-strain coronavirus out of China.

Australian Dollar, Daily Chart

Australia faces economic drag via many channels, the most notable being its status as raw material supplier of choice to the Chinese economy. So far however the RBA has not taken any additional monetary policy action to try and shield Australia from this economic shock. It believes that rate cuts already made are sufficient at this point and is quite sanguine about the likely duration of the virus’ economic effects.

The market still reckons that record low Australian interest rates will slide a further quarter percentage point though, probably in this year’s first half.

Australian Dollar Resources for Traders

Whether you’re new to trading or an old hand DailyFX has plenty of resources to help you. There’s our trading sentiment indicator which shows you live how IG clients are positioned right now. We also hold educational and analytical webinars and offer trading guides, with one specifically aimed at those new to foreign exchange markets. There’s also a Bitcoin guide. Be sure to make the most of them all. They were written by our seasoned trading experts and they’re all free.

--- Written by David Cottle, DailyFX Research

Follow David on Twitter@DavidCottleFX or use the Comments section below to get in touch!

https://www.dailyfx.com/sentiment?re-author=Cottle

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES