AUD/USD aims an establishment above 0.6300, focus shifts to Australian employment
- AUD/USD is aiming to shift its business above 0.6300 amid a cheerful market mood.
- A decline in US Housing Starts could weigh pressure on the DXY.
- Employment opportunities in Australia are rising at a diminishing rate amid a solid labor market.
The AUD/USD pair picked bids after dropping to near 0.6266 and reclaimed the round-level hurdle of 0.6300 in the late New York session. The pair is oscillating above 0.6300 in early Asia and is expected to shift business higher amid positive market sentiment.
On Tuesday, S&P500 witnessed topsy-turvy moves but settled the traded session around the day’s high. Back-to-back positive trading sessions in the US market are signaling that an all-around risk-on profile is gaining traction. Meanwhile, the US dollar index (DXY) is displaying a sluggish price action around the cushion of 112.00 and is preparing for further weakness.
An upside momentum will be triggered for the aussie bulls if they manage to counter the critical hurdle of 0.6344 confidently. The antipodean may gain strength ahead of the employment data, which will release on Thursday. As per the projections, the Employment Change for September will decline to 25k vs. the prior release of 33.5k. Australia’s tight labor market has left less room for growth in employment opportunities. While the Unemployment Rate will remain steady at 3.5%.
Apart from that, the People’s Bank of China (PBOC)’s monetary policy will be keenly watched. Considering the continuation of the no-tolerance Covid-19 policy and weak real estate demand, the central bank may adopt a ‘dovish’ tone on Prime Lending Rate (PLR). It is worth noting that Australia is a leading trading partner of China.
In the US docket, investors will focus on Wednesday’s Housing Starts data, which reflects retail demand for real estate. The economic data is expected to decline by 1.475M against the former release of 1.575M. It seems that accelerating interest rates by the Federal Reserve (Fed) have started displaying their consequences.