EURAUD is still reeling from a sharp move that started in February. The Aussie dollar will need some positive data to help spur a rebound.
Australia’s economy will see the release of employment figures at 9:30am HKT with a reading of 4.2% expected on the unemployment rate- a 0.1% rise despite an expected increase in jobs of 20k. That is a reverse from last month’s loss of 52.8k jobs and is a far cry from some post-pandemic resilience in the job market. Job vacancies were seen as a sign of strength but are now down 30% since May 2022 in the country.
At 2pm there is some medium-level data with German producer prices and 8:15pm is the next high-level data with European Central Bank data releases on monetary policy.
The Australian exchange rates will be awaiting the election on May 3 before making any radical price swings.
His rival Peter Dutton has promised changes to consumers if he is elected as part of the coalition. The Coalition has pledged to slash fuel excise by 25 cents per litre, in a bid to help ease financial pressure on Aussies struggling with a “cost of living crisis,” which is a term repeated often on Australian networks. Mr Dutton has also made promises around housing, offering $1,200 tax cuts to help first home buyers.
The post-election period could see further rate cuts from the country’s central bank as it needs to spur some growth in the economy, but possible inflation and upheaval from tariffs could make it harder to achieve.
Recent financial plans have seen debt growing in Australia as economic growth slows down. DPG Advisory Solutions’ David Gazard has predicted Australia could face a period of “prolonged economic insecurity”.
He pointed to the slower growth in the Chinese economy, with instability in the US as headwinds for Australia. With the election two weeks away, it will be a few months before any rate cut can take effect and tariffs could hurt until that time, worsening the outlook.
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