Asian Session Forex Recap – Oct. 20, 2016

  • AU employment change -9.8K vs. 15.2K expected, -8.6K previous
  • AU unemployment rate down to 5.6%, August’s rate revised higher to 5.7%
  • AU NAB quarterly business confidence up from 3 to 5

The Aussie was the bad hombre during the Asian session, as it gained lost pips on the back of weak Australian data.

Major Events:

Australia’s employment report – Australia’s workers are NOT having a good day. In its latest jobs report, the Land Down Under showed that a net of 9,800 workers had lost jobs in September, way worse than the 15,200 jobs increase that analysts were expecting. Not only that, but August’s job losses were also revised higher, from -3.9K to -8.6K.

Even the unemployment rate’s trip down from 5.7% to 5.6% wasn’t without dark clouds hanging over it. See, August’s rate was revised higher from 5.6% to 5.7% and, with labor participation rate dropping from 64.7% to an almost two-year low of 64.5%, market players believe that the slip to 5.6% was purely from workers giving up on their job prospects.

Last but definitely not the least is the source of the 9,800 decline in jobs. A second look tells us that a net of 53,000 full-time workers had lost their jobs in September, which was only partly softened by the 43,200 gain in part-time jobs. Remember that full-time jobs are preferable to part-time ones, as they represent more stable disposable income for consumers.

Risk-friendly vibe – Asian bourses traded on the green side of the charts today thanks to a combination of factors. Nikkei, in particular, got an extra boost from a weak yen. Asian stocks also took cues from the U.S. sessions, which saw mostly better-than-expected earnings reports.

Then, oil prices continued their small uptrends on the back of surprise inventory drawdowns. Lastly, market players cheered the third and final U.S. Presidential debate where Hillary Clinton gained more ground against Donald Trump in the post-debate polls.

Australia’s ASX is up by 0.12%, the Shanghai index is up by 0.21%, Hang Seng is up by 0.56%, and Nikkei is up by a whopping 1.26%.

Major Market Movers:

AUD – Australia’s jobs report didn’t do the Aussie any favors, as its weak numbers dragged the comdoll lower across the board.

AUD/USD is down by 41 pips (-0.53%) to .7678, AUD/JPY is down by 28 pips (-0.35%) to 79.56, and AUD/NZD is down by 72 pips (-0.67%) to 1.0605.

JPY – The yen got pummelled by its major counterparts despite the lack of major reports from Japan.

USD/JPY is up by 19 pips (+0.18%) to 103.62, EUR/JPY is up by 23 pips (+0.20%) to 113.68, and GBP/JPY is up by 37 pips (+0.29%) to 127.33.

Watch Out For:

  • 6:00 am GMT: Switzerland trade balance (3.27B CHF expected, 3.02B previous)
  • 6:00 am GMT: German PPI (0.3% expected, -0.1% previous)
  • 8:00 am GMT: Euro Zone current account (24.3B EUR expected, 21.0B EUR previous)
  • 8:30 am GMT: U.K. retail sales (0.3% expected, -0.2% previous)
  • 11:45 am GMT: ECB’s monetary policy statement

See also:

U.S. Session Recap
London Session Recap

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