Firmer Australian Dollar after Data
October 8, 2013
The Australian dollar advanced 0.5% against its U.S. counterpart, buoyed by upbeat Aussie data showing a 1.1% jump in September job ads, a 31-month high in business confidence, and a 4-month high in business conditions. Prospects for further monetary relief are fading in Australia.
There’s no sign of any progress toward a U.S. budget deal, no is a breakthrough expected this week.
China reopened after a week-long holiday. The HSBC-compiled service-sector and composite purchasing manager indices for China slid to respective two-month lows of 52.4 and 51.2 in September. In August, such had printed at 52.8 and 51.8.
Bank Indonesia did not hike the key 7.25% central bank reference rate further. A 25-basis point increase at the September meeting had culminated a string of four increases since June totaling 150 basis points. In the meantime, CPI inflation seems to have crested in August, when an unexpected current account had also been recorded. Most importantly, there’s been somewhat of a reprieve from the heavy earlier selling pressure on the rupiah.
German current account and industrial order data for August were not as good as anticipated.
- The current account surplus narrowed to 9.4 billion euros from EUR 14.2 billion in July and EUR 13.2 billion in August 2012. The seasonally adjusted trade surplus of EUR 15.3 billion per month in July-August was down from a pace of EUR 16.0 billion in 2Q13 and EUR 17.0 billion in the first quarter.
- Industrial orders, which had dropped 1.9% in July, fell by a further 0.3% in August.
The U.S. dollar appreciated 0.3% overnight against the yen, 0.2% versus the Swiss franc and 0.1% relative to the euro, loonie, and sterling. The Chinese yuan continues to trade steadily, and the kiwi edged 0.1% higher.
Stocks in the Pacific Rim climbed 1.4% in China, which reopened after the National Holiday, 1.3% in Indonesia, 0.9% in Hong Kong, 0.5% in Taiwan, 0.4% in South Korea and India and 0.3% in Japan and Singapore. Equities have so far fallen by 0.8% in London, 0.5% in Paris and Madrid, and 0.2% in Milan and Frankfurt.
The price of WTI crude oil advanced 0.8% to $103.83 per barrel. That on gold dipped 0.2% to $1322.50 per troy ounce.
The yield on 10-year German bunds firmed two basis points, and those on comparable British and Japanese sovereign debt are up a single basis point each.
Released Japanese data today showed
- A smaller-than-forecast current account surplus of JPY 352 billion seasonally adjusted and JPY 162 billion unadjusted in August.
- A customs clearance JPY 994 billion trade deficit in September 1-20, which was 90.7% wider than a year earlier. On-year import growth of 27.1% outpaced the 17.2% gain of exports.
- A JPY 1.144 trillion net capital outflow in September generated by stock and bond transactions between Japan and non-residents.
- A 3-month high in the economy watchers index of 52.8 in September, breaking a streak of five straight drops.
French business sentiment according to the Bank of France’s measure stayed at 97. Analysts were anticipating an increase for September. The French trade deficit narrowed 3.3% on month in August. The Bank of France dampened its forecast of third-quarter GDP growth to just 0.1%.
The British Royal Institute of Chartered Surveyors’ house price balance index improved to 54 in September from 41 in August. This was the best score in years. Same store sales reported by the British Retail Consortium went up 0.7% in the year to September. Total sales were 2.4% stronger.
Swiss consumer prices rose 0.3% on month in September but were 0.1% lower than a year earlier. Retail sales in Switzerland advanced 1.5% on month and 2.4% on year in August, and the jobless rate stayed at a very subdued 3.2% in September.
A 1.4% on-year decline in Hungarian industrial production in August was worse than expected. Hungary’s trade surplus of EUR 621 billion was 38% bigger than the July surplus. Turkish industrial output in August was 0.1% less than recorded a year before. Spanish industrial production fell 2.0% between August 2012 and August 2013 adjusted for the different number of working days in those months.
The NZIER index of New Zealand business confidence improved to a reading of 38% in the third quarter from 32% in 2Q.
The U.S. budget impasse will prevent the release of scheduled trade figures by the Commerce Dept or the Labor Dept JOLTs index today. Weekly chain store sales, the IBD/TIPP optimism gauge, and the NFIB small business sentiment index are compiled privately and should arrive as planned. Pianalto and Plosser of the Federal Reserve have speaking engagements. Canadian housing starts and trade data are due.
Copyright 2013, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Dollar, German current account, Japanese current account
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