HTML tags are as follows:
Share:
The Australian Dollar (AUD) experienced a break in its winning streak despite a solid increase in new jobs in the country. Australia’s Employment Change rose to 55K in October, with the Unemployment Rate increasing by 3.7% as expected. The US PPI unexpectedly declined by 0.5% compared to the expected increase of 0.1%. China’s House Price Index also declined by 0.38% in October, indicating a worsening condition in the property sector. The Australian Dollar moved below the 0.6500 psychological level with a negative bias on Thursday after the release of the Australian Employment data. The seasonally adjusted Employment Change reported an increase of 55K in October, compared with the market anticipation of 20K and 6.7K in the previous month. However, the majority of the jobs were part-time positions, which diminished the positive impact of the overall headline. Australia’s Unemployment Rate came in at 3.7% in October as expected against the previous figure of 3.6%. However, the AUD/USD pair experienced volatility in the previous session after the economic data was released from the United States (US) on Wednesday. China’s House Price Index declined by 0.38% in October compared to the previous decline of 0.1%, indicating a worsening condition in the country’s property sector. The commitment to stabilize strained bilateral ties and restore some military-to-military communications from the four-hour talks between US President Joe Biden and Chinese President Xi Jinping signals an effort to address and improve the complex relationship between the two nations, potentially paving the way for better diplomatic and strategic cooperation in the future. President Xi emphasized the hope for a partnership between China and the United States, calling for mutual respect, peaceful coexistence, and cooperation in various fields such as the economy, trade, agriculture, climate change, and artificial intelligence. President Xi also expressed the desire for the US to cease arming Taiwan and to support what China terms as the ‘peaceful reunification’ with Taiwan. Additionally, there is a request for the US to lift unilateral sanctions and create a fair and just environment for Chinese companies. The US Producer Price Index (PPI) took an unexpected turn in October, declining by 0.5% against the anticipated 0.1% increase, with the annual rate also witnessing a drop from 2.2% to 1.3%. The softer inflation indicated by Tuesday’s US Consumer Price Index (CPI) data triggered a notable decline in the US Dollar (USD) value. Additionally, US Retail Sales declined by 0.1% in October, defying expectations of a steeper slide of 0.3%. The Reserve Bank of Australia’s (RBA) primary mandate is to maintain price stability, which means an inflation rate of 2-3%, but also “..to contribute to the stability of the currency, full employment, and the economic prosperity and welfare of the Australian people.” Its main tool for achieving this is by raising or lowering interest rates. Moderately higher inflation now tends to lead central banks to put up their interest rates, which in turn has the effect of attracting more capital inflows from global investors seeking a lucrative place to keep their money. Macroeconomic data gauges the health of an economy and can have an impact on the value of its currency. Quantitative Easing (QE) is a tool used in extreme situations when lowering interest rates is not enough to restore the flow of credit in the economy. QE is the process by which the Reserve Bank of Australia prints Australian Dollars for the purpose of buying assets, usually government or corporate bonds, from financial institutions, thereby providing them with much-needed liquidity.×
