Daily Forex Fundamental Overview

Fundamental Analysis

USD

“Current forecasts call for improved global GDP and industrial production growth rates, as well as higher levels of global capital expenditures. We therefore expect improvement to continue”.

- Blake Moret, Rockwell Automation Inc.

CAD

“The fourth quarter was on track for annualized growth of 1.5 percent, in line with the Bank of Canada's recently downgraded forecast”.

- Robert Both, TD Securities

Canadian manufacturing sales advanced more than expected in September, led by the transportation equipment sector, official data revealed on Wednesday. According to Statistics Canada, sales rose 0.3% to C$51.47 billion ($38.28 billion) in the reported month, following August’s increase of 0.9%, while market analysts anticipated a fall of 0.2%. However, not taking into account price changes, the volume of factory goods sold in September, dropped 0.2%. On an annual basis, factory sales climbed 1.4%. Even though sales fell in volume terms, manufacturing sales are expected to provide significant support to the Canadian economy in the Q4. Sales grew in 12 out of 21 industries; however, the transportation equipment sector’s gain of 1.5% accounted for more than 85% of the September gain. The September rise was also helped by fabricated metal products, which posted a 2.4% increase, the largest since May of 2015. Statistics Canada also said that new orders advanced 2.3%, mainly driven by gains in the machinery and transportation equipment sectors, while unfilled orders decreased 0.2% in the ninth month of the year. Furthermore, inventories increased 0.5% to C$70.27, supported by the food, transportation equipment and chemical industries.

AUD

“Since December 2015 we have seen a continued decline in trend full-time employment and an increase in part-time employment, with a corresponding increase in the share of hours worked by part-time workers”.

- Jacqui Jones, Bureau's labour and income branch

The unemployment rate has remained steady at 5.6%, despite the creation of nearly 10,000 jobs in October, since workforce participation dropped to a decade low. The jobs growth was spurred by 41,500 extra full-time positions while the seasonally adjusted estimates point to 31,700 part-time jobs being shed. In comparison, part-time employment has advanced by 132,700, with its share of overall employment increasing from 31.1% to 32%. Meanwhile, economists have said wages are growing so slowly in Australia because the demand for labour, and the composition of labour, remains insufficient to make wages rise in a significant way. On a gender-basis, the unemployment rate slipped to 5.52% for males, registering the lowest level since February 2013, while that among females remained unchanged at 5.64%. Labor force participation, in turn, held steady at 64.4%, courtesy of a downward revision to the September figure which was previously reported at 64.5%.

In the meantime, the employment report remains a major indicator for the policy moves by the Reserve Bank of Australia and the November jobs data will be eyed closely before the next monetary policy meeting scheduled to be held in mid-December.

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