AUD/USD Daily Forecast

Thursday, Jan 05 2017

There were no data releases from Australia, but from China Services PMI figures were published. The headline Caixin China General Services PMI was up 0.3 points from a month ago to 53.4 in December. The sub-indices of new orders, input costs and prices charged all went up. The Caixin China Composite Output Index came in at 53.5 in December, up 0.6 points from November and the highest levelsince 2013. Manufacturing and services both expanded in December, showing recovery in the economy continued.

In the US session ADP Employment Change, Unemployment Claims and Non-Manufacturing PMI data was released. Private sector employment increased by 153,000 jobs from November to December according to the December ADP National Employment Report. “As we exit 2016, it’s interesting to note that the private sector generated an average of 174,000 jobs per month, down from 209,000 in 2015,” said Ahu Yildirmaz, vice president and head of the ADP Research Institute. “And while job gains in December were slightly below our monthly average, the U.S. labor market has experienced unprecedented seven years of growth that has brought us to near full employment. As we enter 2017, the tightening labor market will likely slow the growth.”

Separate report on Unemployment Claims showed that in the week ending December 31, the advance figure for seasonally adjusted initial claims was 235,000, a decrease of 28,000 from the previous week's revised level. The previous week's level was revised down by 2,000 from 265,000 to 263,000. The 4-week moving average was 256,750, a decrease of 5,750 from the previous week's revised average. The previous week's average was revised down by 500 from 263,000 to 262,500.

The NMI® registered 57.2 percent in December, matching the November figure. This represents continued growth in the non-manufacturing sector at the same rate. The Non-Manufacturing Business Activity Index decreased to 61.4 percent, 0.3 percentage point lower than the November reading of 61.7 percent, reflecting growth for the 89th consecutive month, at a slightly slower rate in December. The New Orders Index registered 61.6 percent, 4.6 percentage points higher than the reading of 57 percent in November.

From Australia, tomorrow, Trade Balance figures will be published. Analysts forecast deficit of $0.55 billion. In the US session NFP data will be released. Unemployment Rate is expected to rise to 4.7%, while number of employed should increase by 175,000.

Figures to watch:

Trade Balance (Friday 1:30)

Non-Farm Employment Change/Unemployment Rate (Friday 14:30)

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