The Australian dollar should be on a roll after data from both Australia and its No. 1 trading partner China point upwards. AUD/USD is trading around 0.7870, up from the lows of 0.7840. This is a relatively limited move. Is the Aussie showing us its weakness?
Australia received a better-than-expected jobs report. The country gained 19.8K jobs in September, better than 15K expected. In August, the land down under enjoyed a big jump of 53K. The unemployment rate dropped from 5.6% to 5.5%, also better than expected.
Full-time jobs are up 6.1K while part-time employment is up 13.7K, and this is not the best composition, but good enough. The participation rate stands at 65.2%.
All in all, Australia’s job market looks good, as it did throughout the year.
Chinese data
China is the world’s No. 2 economy and Australia’s No. 1 trade partner. China’s robust growth kept Australia from falling into a recession for a generation. Also in Q3 2017, the economic giant reported robust growth: 6.8% y/y. Quarter over quarter, the economy grew by 1.7%.
The data is released during the all-important Communist Party Congress held every five years. Was economic growth kept strong ahead of the event? Will China slow down after this event?
China also released other figures: Fixed Asset Investment rose by 7.5%, slightly below expectations for 7.7%. Retail sales are up 10.3%, and in this case, it is above 10.2% predicted. Industrial output, which is the most important figure for Australia, is up 6.8%, beating expectations.
AUD/USD rising
The Australian dollar is moving upwards, but these movements are relatively shallow. At 0.7870, we are up some 30 pips during the day and 50 pips from the lows seen yesterday. Resistance awaits at 0.79, followed by 0.80.
