Choppy week for the Australian dollar as traders balanced mixed Australian updates against counter currency themes and news events.
Ultimately, the Aussie closed the week as a net loser as broad risk sentiment leaned negative on Friday.
Australian Headlines and Economic data
It’s likely the pop higher was less on the updates from Australia, and more on the positive updates from China (China’s industrial engine gathers speed, consumers open wallets in boost to recovery) setting off a risk-on lean in the markets for the session.
No major catalysts from Australia on the session, but we saw a broad move lower in the Aussie against the majors, likely moving with the broad risk-off sentiment that took over after the Federal Reserve shared a broadly negative outlook on the world’s largest economy, especially if the U.S. government fails to deliver a stimulus package.
Australia unemployment drops as half of jobs lost recovered – “The jobless rate dropped to 6.8% in August from 7.5% a month earlier versus a median estimate of an increase to 7.7%”
Choppy price action on Friday for the Aussie against the majors during the Asia and London session, but ultimately falling during the U.S. session as risk sentiment turned negative ahead of the weekend. This environment was likely sparked by a combination of scenarios ranging from a low expectancy of a new stimulus package from the U.S. government, the possibility of the U.K. locking down once again, and as the U.S. tech sector continues to fall.