Australia's exports still require close monitoring.

The Australian dollar has strengthened once again. Based on the latest unemployment rate data released yesterday, it is unlikely to prompt the Reserve Bank of Australia (RBA) to adopt stricter policies. Despite the stronger-than-expected economic expansion in the second quarter, other economic indicators, including exports, remain a cause for concern. Analysts also anticipate that interest rates will stay unchanged.

Apart from domestic factors, there are also influences from the United States, such as the Consumer Price Index (CPI) announced yesterday and today's release of the Producer Price Index (PPI) with an expected increase of 0.4% from the previous month's 0.3%. If the PPI surges significantly, it could impact inflation rates and potentially lead to the Federal Reserve (FED) raising interest rates again, affecting market confidence.

Australia's unemployment rate stands at 3.7%, unchanged from the previous month. The number of unemployed individuals decreased by 2.6 thousand to 540.5 thousand, mainly due to an increase in full-time employment by 6 thousand, totaling 358.3 thousand. Furthermore, wage growth is expected to increase in the near future. Meanwhile, there has been an increase in hiring, with 64.9 thousand new jobs, totaling 14.11 million people. However, employment levels remain lower than before the onset of Covid-19.

There has been a forecast that the consumer price inflation rate in Australia will decrease to 4.6% from the previous 4.9% in the preceding month. The lowered inflation rate forecast further reinforces the expectation that the Reserve Bank of Australia (RBA) will temporarily halt interest rate hikes. Additionally, Philip Lowe, the outgoing governor of the central bank, recently mentioned that medium-term inflation forecasts are expected to align with the RBA's target inflation rate of 2-3%. He also expressed the view that inflation has likely peaked.

The reduced inflation rate forecast has led to an increase in Australia's business confidence index, rising to 2 in August from the previous month's 1. This positive trend is supported by the profitability of various companies and an increase in hiring. However, labor costs have risen by 3.2% over the past three months, and procurement costs have increased by 2.9%.

Techical analysis data (5H)

Resistance: 1.5565, 1.5585, 1.5614

Support: 1.5517, 1.5489, 1.5469

Source: Investing.com