Australian dollar faces big week
Published on 10.09.2018 17:44

The Australian dollar has received some support today, courtesy of China after last Friday’s sharp tumble against its US counterpart on the back of another stellar job’s report from the US that all but guarantees a rate hike from the US Federal Reserve this month.

Data out of America on Friday as reported by the U.S. Bureau of Labor Statistics showed the nonfarm payroll employment increased by 201,000 in August, while the unemployment rate remained unchanged at healthy 3.9 percent.

With a rate hike, basically a foregone conclusion this month, the chances have also risen of more rate hikes by the US Federal Reserve before years end which is not going to do any favours for the Aussie dollar.

Data out of China released earlier today showed CPI figures currently sitting at 0.7 percent which was well above expectations for a number 0.5 percent which is good news for the Australian dollar as China id Australia’s biggest trading partner.

The fate of the Australian dollar this week will be driven by 2 factors which are further tariffs against China which US President Donald Trump may announce at any moment now and Thursday’s unemployment report and Job participation figures.

Trump is expected to announce another further $200 billion of trade tariffs against China and if we go by the first round of tariffs that were introduced, are expected to hit the Aussie dollar hard.

If Australia’s unemployment rate moves higher or there are any surprises to the downside with the number of jobs created in the Australian economy last month we may see the Aussie dollar fall below US70c which has something the market hasn’t seen since early 2016

 

The material published in on this page is produced by the FIBO group companies, and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

Andrew Masters

Analyst

The world of trading has no boundaries

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 66% of retail investor accounts lose money when trading CFDs with this broker. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

×

Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 66% of retail investor accounts lose money when trading CFDs with this broker. Before deciding to trade foreign exchange you should consider whether you understand how CFDs work, your investment objectives, your level of experience and readiness of taking risk. The possibility exists that you could sustain a loss of some or of all of your initial investments and therefore you should not risk more than you are prepared to lose. Please seek independent financial advice if necessary.

Important notice
By clicking "Continue" you will be redirected to the website operated by FIBO Group, LTD company registered in BVI and regulated by FSC. Please familiarize yourself with the Customer Agreement through the link. Click "Cancel" to remain on this page.