AUDUSD is moving in the Descending channel and the market has reached the lower high area of the channel.
The Employment Change report that was made available by the Australian Bureau of Statistics is a measurement of the change in the total number of persons in Australia who are now employed. An increase in this statistic, in general, has good implications for consumer spending, which helps to boost economic growth. As a result, a high rating is considered to be constructive for the AUD, whilst a low value is considered to be bearish.
Kohler on Cost of Living
Head of Economic Analysis Department, Marion Kohler, recently gave a speech where she discussed the recent cost of living crisis in Australia. Kohler reveals, “The cost-of-living pressures currently being faced by all Australians are a result of a substantial rise in the rate of inflation over the past year or so. Annual inflation as measured by the Consumer Price Index (CPI) has increased from a little below 2 per cent in the years immediately prior to the pandemic to around 8 per cent at the end of 2022. Prices have risen significantly for many of the goods and services that people buy. Today, the higher cost of living is front of mind for many more people than was the case in the years leading up to the pandemic.”
EURAUD is moving in the Descending channel and the market has reached the lower high area of the channel.
“Different groups in society have different patterns of spending, so their experience of cost of living can vary from the national average. Lower income households typically have the most constrained budgets. These households, including those on the age pension and other welfare payments, tend to spend more of their income on essential items such as food, utilities and rent.
Higher income households tend to spend more on items like owner-occupied housing and so-called discretionary items such as recreation and consumer durables. We are currently revising our forecasts and will publish these at the end of next week, so we are not in a position to preview them yet. What we can say is that we think the peak in inflation was at the end of 2022 – at around 8 per cent – and that inflation will begin to ease over the course of this year.”
Australian Student Employment
In 2022, the average annual salary for a non-Australian working full-time and attending undergraduate school was AUS$60,000, while the annual salary for an Australian was AUS$68,000. According to the 2022 International Graduate Outcomes Survey, the disparity in pay was not as apparent as it was in 2021, when the difference between the two groups was AUS$10,700.
Research that was funded by the Department of Education and looked at student employment outcomes approximately four to six months after graduation came to the conclusion that studying at the postgraduate coursework level did not increase earnings among international graduates when compared to those who took undergraduate courses. On the other hand, domestic students who obtained postgraduate credentials earned an average of 23,600 Australian dollars more.
GBPAUD is moving in an Ascending channel and the market has reached the higher low area of the channelAlthough almost sixty percent of international students who attended undergraduate programs in Australia in 2022 were working full-time jobs up to six months after graduation, international students still face much lower employment rates when looking for work after graduation, both within and outside of Australia. International students who completed their degrees in Australia but then relocated back to their home countries or to another country were less likely to be working full-time jobs than their counterparts who had remained in the country.
China COVID Crisis
The Chinese economy had one of its worst performances in decades last year as a result of numerous COVID lockdowns followed by a deadly outbreak in December that swept across the country with remarkable speed. This caused growth to be dragged down, which resulted in the economy having one of its worst performances in decades. Not only was the outbreak first discovered in China, but this nation is also one of the few still suffering from its existence.
AUDJPY Market has broken the Descending channel in Upside.
The rigorous zero COVID limitations imposed by the government in 2022 cast a shadow over the year, suffocating the economy with regular quarantines, regional lockdowns, and significant spending to pay for comprehensive testing. Then, after nearly three years, China abruptly reversed the policy without providing any explanation. Within a few of weeks, the virus had infected hundreds of millions of individuals, caused the deaths of many senior citizens, and rendered workplaces and public spaces like restaurants, offices, and factories devoid of customers and employees.
In spite of the damage caused by zero COVID, China appears to have experienced faster growth over the past year than major competitors such as the United States, Japan, and Germany. Economists estimate that each of these three countries experienced growth of less than 2 percent in the previous year. As a result, we can expect the AUD markets to positively benefit from this revelation. Australia is going to be one of the many importers that have been highly anticipating when China would return back into the trade market.
Australian Iron Ore Market
After China’s COVID shutdown pushed down iron ore prices, Australia’s iron ore heavyweights BHP Group, Rio Tinto, and Fortescue are expected to disclose a significant decline in their profitability. As a result, these companies are expected to reduce the amount of money they pay out to shareholders.
AUDCAD is moving in the Descending triangle pattern and the market has reached the horizontal support area of the pattern.
According to estimates provided by Visible Alpha and Vuma Financial, Rio Tinto and BHP Group are expected to experience a decrease in earnings of 48% and 28%, respectively, for the six months leading up to December 2022, while Fortescue is anticipated to experience a decrease in earnings of approximately 16% for the same time period.
It is anticipated that the mining companies would provide a balanced view for the year 2023, notwithstanding the uncertainty over the extent of China’s recovery following the removal of its stringent COVID-19 regulations. The firms are also dealing with increasing expenses for materials and gasoline, as well as a shortage of experienced labor, all of which might have an impact on the growth projects they are working on. Iron ore’s realized prices on average experienced a precipitous decline in the six months leading up to December.
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