With the US election concluded, we were back on data-watch in Asia.
The Australian employment report was a surprise to the upside with a solid 10,700 jobs added in October, a respectable number considering the paltry +500 print expected. More impressively, a total of 18,700 jobs were added in the full-time sector (and an upward revision to September’s data to 34,500) with the balance of 8,000 jobs lost in the part-time sector. Drilling deeper into the report, hours worked declined by 0.3 percent m/m after a 0.5 percent increase the previous month.
The Unemployment rate held steady at 5.4 percent but a fractionally lower participation rate (65.1 percent from 65.2 percent) took some of the shine off this number. In addition, the unemployment rate in Western Australia, the heart of most of Australia’s resource mining, rose to 4.6 percent, the highest since April 20101. AUD responded well to the headline data with a kneejerk rally of 40 pips versus both the USD and JPY while bank bill futures fell 5 ticks.
Across the Tasman Sea the data was not so frisky. New Zealand’s unemployment rate jumped to 7.3 percent from 6.8 percent in Q2 and is the highest reading since 1999. Employment fell 0.4 percent in the quarter driven by a 0.8 percent decline in full-time employment. The NZD/USD tumbled to a 2-week low and in the aftermath of the Ozzie jobs data AUD/NZD surged to 7-1/2 week high.
Data out of Japan was also uninspiring with machine orders, the current account and trade balances all below forecast. The c/a balance did improve to ¥503 bln but expectations were for a much higher ¥761.8 bln print. On a seasonally-adjusted basis, the balance slumped into deficit (-¥142 bln) for the first time since 1985.
There was more weakness for the EUR overnight as German data failed to impress, the EC downgraded growth forecasts and ECB’s Draghi came out with some dovish/downbeat comments. EUR/USD gave back all the gains made in Asia and fell back through 1.28, took out the previous day’s low at 1.2765 and eventually halted close to the Fibonacci retracement level at 1.2740.
A broader risk-off trade permeated through markets with the USD index also retracing all the post-election losses as the focus now shifts to US fiscal cliff. GBP felt a bit of pressure ahead of today’s BOE meet though expectations are still for an unchanged outcome.
There were no US data releases so sentiment on Wall Street was driven by the broader risk-off mood. The DJIA closed down 2.36 percent, S&P -2.37 percent and the Nasdaq -2.48 percent.
Data Highlights
- US MBA Mortgage Applications out at -5.0% vs. -4.8% prior
- US September Consumer Credit out at $11.36 bln vs. $10.17 bln expected and revised $18.39 bln prior
- NZ Q3 Unemployment Rate out at 7.3% vs. 6.7% expected and 6.8% prior
- NZ October QV House Prices out at +5.7% y/y vs. 5.3% prior
- JP September Machine Orders out at -4.3% m/m, -7.8% y/y vs. -2.1%/-4.9% expected and -3.3%/-6.1% prior resp.
- JP September Current Account Total out at +¥503.6 bln vs. +¥761.8 bln expected and +¥454.7 bln prior
- JP September Trade Balance – BOP out at -¥471.3 bln vs. -¥413.5 bln expected and -¥644.5 bln prior
- JP October Bank Lending out at +1.1% y/y, as expected vs. 1.2% prior
- AU October Employment Change out at +10.7k vs. +0.5k expected and revised +15.5k prior
- AU October Unemployment Rate out at 5.4% vs. 5.5% expected and 5.4% prior
(All Times GMT)
- JP Economy Watchers’ Surveys (0500)
- Swiss Unemployment Rate (0645)
- GE Trade Data (0700)
- Sweden Avg. House Prices (0830)
- UK BOE Rate Announcement (1200)
- EU ECB Rate Announcement (1245)
- CA Housing Starts (1315)
- EU ECB’s Draghi Press Conference (1330)
- CA New House Price Index (1330)
- CA Int’l Merchandise Trade (1330)
- US Trade Balance (1330)
- Us Initial Jobless Claims (1330
- US Bloomberg Consumer Comfort Index (1445)