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Sep 12 - 11:00 AM
AUD: Why AUD Struggles To Rally; AU Labor Market Data In Focus - Credit Agricole
First appeared on eFXplus on Sep 12 - 09:04 AM

Credit Agricole CIB Research discusses AUD outlook around tonight's Australia's jobs report for the month of August.

"Australia releases wages and inflation only quarterly, however, so one of the few regular barometers of inflationary pressures in the economy is the monthly labour market data, which are released Thursday. Leading indicators point to further slowing in employment growth from the very elevated pace recently, but that this growth will be firm enough to keep the unemployment rate on a gradual downward path. 

Indicators of labour market slack will be the main focus for the markets especially how close the unemployment rate is getting to the RBA’s NAIRU estimate of 5% (the unemployment rate is currently 5.3%). It is worth noting, however, that while the unemployment rate has nearly hit a six-year low, the underemployment rate remains elevated," CACIB argues. 

"The AUD continues to be used by investors as a liquid proxy to express negative views on EM, which is holding the currency down, along with building investor concerns about a potential US-China trade war. These factors will likely remain the main driver of the AUD in the coming weeks," CACIB adds. 

Source:
Crédit Agricole Research/Market Commentary

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