Sterling in holding pattern ahead of BOE decision
The Australian dollar rose as the markets reacted to employment data. The numbers, released by the Australian Bureau of Statistics (ABS), showed that the unemployment rate dropped to 5.2% in November from 5.3%. The participation rate remained unchanged at 66.0% while the employment change rose by 39.9k. These numbers show that the Australian labour market continues to be vibrant. Similarly, the New Zealand dollar rose after the country released the final reading of Q3 data. The GDP expanded by a QoQ rate of 0.7%, which was better than the previous 0.1%. It expanded by an annualised rate of 2.3%. This was better than the previously reported growth of 2.1%.
Sterling remained in a holding pattern as the market waited for important data and news today. The Office of National Statistics will release retail sales for the month of November. The retail sales are expected to increase by an annualised rate of 2.1%. This growth will be lower than October’s 3.1%. The sales will increase by an MoM rate of 0.3%. The core retail sales are expected to have expanded by a YoY and MoM rate of 1.9% and 0.3% respectively. The biggest news will be from the Bank of Japan (BOJ), which will deliver its final rates decision of the year. The bank is expected to leave rates unchanged at 0.75%.
The market will also focus on data from the United States and other key central banks. In the United States, the market will receive the Philadelphia Fed Manufacturing index. The index is expected to move from 10.4 to 8.0. The continuing jobless claims are expected to increase from 1,667k to 1,681k. The initial claims are expected to have dropped from 252k to 225k. In Europe, the Swedish and Norwegian central banks will deliver their rates decision. The Swedish central bank is widely expected to hike rates while the Norwegian bank is expected to leave rates unchanged.
The EUR/USD pair rose slightly during the Asian session. The pair moved from a low of 1.1110 to the current 1.1130. The Chaikin oscillator has moved slightly above the neutral line. The pair will likely remain along the current levels today.
The GBP/USD pair remained in a holding pattern as traders waited for the BOE decision. The pair is trading at 1.3085, which is slightly above last week’s low of 1.3048. This price is along the 14-day and slightly below the 28-day moving averages. The RSI has been moving steadily from a low of 20 to the current 43. The momentum indicator has also been moving upwards slightly. The pair may see some significant volatility later today.
The AUD/USD pair rose after positive jobs numbers from Australia. The pair, which had formed a double bottom at 0.6837, rose to a high of 0.6878. The price is slightly above the 50% Fibonacci Retracement level on the hourly chart. The RSI has moved upwards from the oversold level of 23 to the current 63. The main and signal lines of the RVI to have been moving higher. The pair may continue moving upwards to test the important level of 0.6900.