Global Themes

18 April: Aussie’s gains fade as markets look to jobs, CPI

The AUD was unable to hang on to the post-Chinese data gains overnight with the two-month highs continuing to provide major resistance. This level has provided trouble for the Aussie’s recent gains with markets still concerned about the potential for a Reserve Bank of Australia rate cut. Chinese March-quarter GDP, reported at 6.4%, was slightly above expectations, but a big jump in retail sales and industrial production signalled the Chinese government’s stimulus programs were providing a boost to growth.

Yuan gains on Chinese data

The Chinese yuan was boosted by the Chinese data and USDCNY is now at the lowest level since July. An improvement in Chinese data and the belief the Chinese government is trying to ease tensions with the US is helping the CNY. The AUDCNY fell yesterday as it nears four-year lows.

Aussie jobs today

There’s a growing risk of a miss in today’s jobs report with last month’s employment report missing expectations for the first time since October and the ANZ job ads dropping sharply over the last few months. The market is looking for 12k new jobs with the unemployment rate expected to climb from 4.9% to 5.0%. The Australian jobs report is due at 11.30am AEST. The RBA has signalled that any rise in unemployment – especially accompanied by weaker inflation – could cause the central bank to cut rates. March-quarter inflation is due on Wednesday.

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