Australia’s Unemployment, UK Retail Sales and The New Head of EU Commission

Australian Jobs; UK Retail Sales

This morning we received the Australian unemployment number, which came out the same as expected. The unemployment rate was the same as previous, at 5.2%. It held steady for the third month in a row, even though the figure had risen from the February low, at 4.9%. That said, the current number is still near the 9-year lows, which is still seen as a positive thing. But unlike the unemployment rate, the employment change number had fallen even further, not only below the previous, but also below expectation. The consensus was for the number to come out at +9.1K, but that slid even more, showing up at +0.5K, which is way below the previous +42.3K for the month of May. Last time the number was that close to negative territory was in February, which was +4.6K. The last time the figure was below zero, was in July. The full employment change number for the month of June was much better than the previous, it came out at +21.1, whereas the month before that was at +2.4K only. This is a good positive jump, given that for last two months the data was quite disappointing.

Van Der Leyen Steps In; Lagarde Steps Down, In Order To Step In Later

Speaking about politics, the new president of the European Commission was elected. For the first time in history, the top seat went to a female candidate. Ursula von der Leyen, the former German defence minister, will now have the job to at least try and fulfil her promises, among which are taxes, climate change and migration. As the first female EU chief executive, she and her team will have to find a way how to unite the European leaders again, as it is no secret that rising protectionism among individual states is damaging the European Union as a whole. It is clear that economic and social situations in individual European states are different. Inequality and the wish to fight for a better standard of life is fuelling protectionism and the rise of the rightist parties in some member states.

AUD/CAD — Technical Outlook

After the release of the Australian employment data, which came out this morning, AUD jumped against most of its major counterparts, and the Canadian dollar was no exception. After yesterday’s Canadian CPIs, CAD remained side-lined, which helped AUD/CAD to push higher this morning. From the technical side, we can see that the pair is now breaking its medium-term downside resistance line taken from the high of April 17 th. This could finally be that signal, which could allow AUD/CAD to drift further north. That said, given that the rate is still below the 200 EMA and the key barrier at 0.9203, we will remain cautious and wait for a clear break above those two obstacles, before examining further upside. This is why we will take cautiously-bullish approach for now.

GBP/AUD — Technical Outlook

GBP/AUD continues to trade below a short-term downside resistance line taken from the high of June 25 th. After finding good support near 1.7627 this week, the pair rebounded and tried to recover some of its losses, but eventually it got held near the 21 EMA. The rate slid back down again and is now testing the area around the 1.7672 hurdle, which we will keep a close eye on today. Given that GBP/AUD failed to move further north, there is a possibility for some further declines in the short run, hence why we will stay somewhat bearish for now.

As For The Rest Of Today’s Events

in the US, the Philly Fed manufacturing index for July is anticipated to have risen to 5.0 from 0.3.

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