Last week found the continued movement upwards for the AUD amongst a basket of currencies. The main reason for the gains was a lowering of global financial risk levels. The second reason was the Reserve Bank of Australia holding rates at 2% and not mentioning any plans for that to change. This brought confidence the AUD as it was widely expected that the Interest Rate would be cut on Melbourne Cup Day. Stock markets have also been trading up which is indicative of investors coming back after risky signs have subsided.
China was away on ‘annual leave’ for the majority of last week. This meant that China had little in the way of data releases and no important figures that were released. This week will be different as China will kick things off with their Trade Balance figure on Tuesday. This figure is a tentative release so it will prove to be a very volatile day as well risk throughout the day for investors. At face value the figure is expected to be markedly weaker than the previous figure at 46.9 Billion; from 60.2 billion. This should not give any assistance the AUD.
On Wednesday at 11.30pm AEST; the Chinese economy will be releasing their inflation figure for this month. Last month the Chinese economy surprised the market achieving a much desired 2% CPI figure. This month they are looking a revised down figure of 1.8%, however; this is still considered strong amongst the developed countries.
Lastly, out of Australia on Thursday, investors will be nervously waiting for the monthly employment figures to be released. The figures have been trending up more recently, however; Australia is still down from July, 2015. Market analysts are expecting 7200 jobs to be created and the Unemployment rate to remain on 6.2%. This figure is considered on par with the previous month’s figure; therefore, investors will seek figures that deviate from this to prompt movement in the AUD.