AUD/USD Fundamental Analysis October 16, 2014 Forecast

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Updated: Aug 25, 2015, 00:00 GMT+00:00

Analysis and Recommendation: The AUD/USD eased by 4 points against the stronger US dollar after Chinese inflation data missed expectations. At the IMF and

AUD/USD Fundamental Analysis October 16, 2014 Forecast

Analysis and Recommendation:

The AUD/USD eased by 4 points against the stronger US dollar after Chinese inflation data missed expectations. At the IMF and World Bank meetings in Washington last week, the chief economist of the People’s Bank of China identified the country’s property sector, which accounts for 20 per cent of total investment, as the main downside risk for the Chinese economy. Consumer prices in China rose more than forecast in September, fuelled mainly by a surge in food prices. Prices rose 3.1% during the month, from a year earlier, up from 2.6% in August, the National Bureau of Statistics said.

The bureau said that food prices rose 6.1% from a year ago due to the impact of national holidays, as well as droughts and floods in some regions. Some analysts said that rising prices had reduced the chance of any major monetary policy moves by Beijing.

In Australia, every market economist holds the same belief that the RBA will lift rates next year, despite the range of headwinds and challenges facing the Australian economy. Unfortunately it’s better to be collectively wrong than prove a different point-of-view for investors and market participants.

The important point on interest rates is that it remains data-dependent. The RBA might have a central view of how the economy will develop and what might prompt a rate rise, but that narrative can easily change. As the RBA and Debelle have noted in the past, the RBA is dreadful at economic forecasting.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Today’s economic releases actual vs. forecast:

Cur.	Event	Actual	Forecast	Previous
AUD	Consumer Sentiment	0.9%		-4.6%
CNY	CPI (MoM) (Sep)	0.5%	0.4%	0.2%
CNY	CPI (YoY) (Sep)	1.6%	1.7%	2.0%
CNY	PPI (YoY) (Sep)	-1.8%	-1.6%	-1.2%
JPY	Industrial Production		-1.5%	-1.5%

Upcoming Economic Events that you should be monitoring:

Cur.	Event	Actual	Forecast	Previous
NZD	Business NZ PMI (Sep)			56.5
EUR	Core CPI (YoY) (Sep)		0.7%	0.7%
EUR	CPI (MoM) (Sep)		0.4%	0.1%
EUR	CPI (YoY) (Sep)		0.3%	0.3%
USD	Initial Jobless Claims		290K	287K
CAD	Manufacturing Sales		-1.6%	2.5%
USD	Industrial Production		0.4%	-0.1%
USD	Phil Fed Manufacturing		20.0	22.5