Australian Dollar Outlook - 09 September 2013

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By Christine Gaylican | September 9, 2013 10:07 AM EST

Bell FX Currency Outlook: The Australian Dollar has started the week over .9200 after touching a three week high on Friday night as the US jobs data fell short of predictions and some analysts felt that the US Federal Reserve's tapering program would be delayed.

Australia: With the August US non-farm payroll data coming in at a rise of 169k jobs for last month as compared to the predictions of 180k the AUD rose above .9200 as many analysts felt the beginning of the reduction in Fed purchases of securities might be delayed from the expected start later this month.

Also helping the AUD move higher this morning were the latest figures from China's customs department that revealed over the
weekend that overseas shipments rose 7.2% in August from a year earlier and the trade surplus was USD28bn for the month and USD 154bn for the first eight months of 2013 which is 28% higher than a year ago.

Early this week we will see a slew of data from China starting with some consumer and producer price figures today followed tomorrow by industrial output, retail sales and fixed asset investment which may have an effect on the short term direction of the AUD.

Over the weekend the Liberal National Party Coalition won government after being out of power since 2007 with a clear majority in the House of Representatives as the Labor Party recorded the lowest primary vote in over 100 years although it most likely
the balance of power in the Senate is likely to be held by independents and minor parties.

Majors: US job figures disappointed slightly with previous two months of figures also revised downward by 74k jobs. Unemployment fell from 7.4% to 7.3% as the labor participation rate fell by 0.2% to 63.2%.

Government payrolls fell 38k while manufacturing jobs and construction jobs both lifted which is consistent with the better ISM manufacturing numbers we have seen of late. Some analysts still believe that the tapering program will begin later this month with many favouring a reduction in buying from USD85bn to USD70bn each month.

Along with a stronger tone for the AUD, the NZD was dragged higher after the better trade figures from China. The G20 meeting ended in St Petersburg with no agreement for a military strike in Syria. President Obama will continue to pressure US Congress. The BIS (Bank for International Settlements) has released their 3 year survey of FX trading complied from over 1300 institutions and the USD dominates 87% of all trades which is up 2% from three years ago.

The EUR's share has fallen to 33% from 39% while the AUD remains the fifth most traded currency after the JPY and GBP.
Economic Calendar
9 SEPT AU ANZ Job Advertisements m/m Aug
AU Home Loans m/m Jul
CH CPI y/y, PPI y/y Aug
JN GDP Q2

For latest pricing, ranges, visit www.bellpotter.com.au

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