The Australian Dollar found support after the release of favorable employment figures, marking a significant turnaround following three consecutive days of losses against the US Dollar. Australia’s Employment Change for September rose dramatically by 64,100, reaching a record total of 14.52 million jobs. This surge exceeded expectations significantly, as analysts had predicted an increase of only 25,000 jobs, following a revised rise of 42,600 in the previous month.
In conjunction with this positive employment report, the unemployment rate in Australia held steady at 4.1%, which was better than the anticipated rise to 4.2%. The number of unemployed individuals dropped by 9,200, bringing the total to 615,700. These labor statistics indicate a resilient job market despite ongoing economic challenges.
In the US, data reflecting strong labor performance and inflation has bolstered support for the Dollar, moderating speculation about aggressive interest rate cuts by the Federal Reserve. Traders are particularly focused on upcoming Retail Sales figures expected to show a 0.3% monthly increase for September, compared to a previous reading of 0.1%. Current market indications point to a 92.1% probability of a 25-basis-point rate cut in November, with no predictions for a more extensive cut.
Meanwhile, consumer confidence within Australia appears stagnant, as the ANZ-Roy Morgan Consumer Confidence index remained at 83.4, indicating a trend that has persisted below the 85.0 mark for an unprecedented 89 weeks. In the context of this, the Commonwealth Bank of Australia forecasts a potential rate cut of 25 basis points by the end of 2024, contingent upon a stronger disinflationary trend.
From a broader perspective, data emerging from China has indicated a stagnation in the monthly Consumer Price Index, registering at 0% for September, along with a year-on-year drop in the Producer Price Index of 2.8%. As geopolitical and economic dynamics evolve, the AUD/USD exchange rate hovers around 0.6700, with analysts observing key resistance and support levels that could indicate shifts in market momentum.
