A number of important data was reported overnight during the Asian session. Australian employment change registered a particularly strong figure for August and when compared to the previous month’s figures. However data out of China, the world’s second largest economy, disappointed with some weaker industrial activity.
The prevailing mood during the asian session was rather a negative one if we had to take the major equity indices as a preliminary gauge of sentiment, because most of them were headed lower.
August employment change in Australia was out at 54.2K compared to a previous 29.3K for July these figures show a stellar performance for the Australian labour market that has grown at a steady pace this past year. The Aussie reacted positively with gains across the board, although the release of some softer than expected data out of China may have reduced the vigour of the move higher.
Australia is China’s largest trading partner, and the effect of softer Chinese Retail Sales and Industrial Production (both for the month of August) undoubtedly tend to reflect on the Aussie – although at the time of writing the AUD is still well in green territory.
USD remains steady although as seen on the US Dollar index price action is currently facing resistance around the 20 DMA, at 92.52. Later today the US shall report its latest inflation numbers. Inflation is an important variable for monetary policy so expect the USD to reflect the mood later on today.
