The Australian economy has experienced a slight slowdown.

The Australian dollar strengthened to 1.52 Australian dollars per US dollar, supported by improved economic data from China. Investors anticipate that the Reserve Bank of Australia (RBA) will not cut interest rates until November, with a projected reduction of only 33 basis points for the year.

Consumer inflation expectations in Australia are forecasted at 4.5% in January, reaching the lowest level since January 2022. The stringent monetary policy implemented in recent times has significantly influenced both price levels and inflation rates. However, wage growth remains weak as business profits have not seen substantial growth.

Business confidence has improved slightly to -1 in December, compared to the previous month's decrease to -8. This improvement is attributed to the recovery in the mining and retail sectors. Nevertheless, long-term business prospects remain sluggish, with declining sales in various sectors. Alan Oster, Chief Economist at NAB, mentioned that economic surveys indicate a slowdown in economic growth, providing a possibility of further declines in inflation rates in the future.

Consumer confidence has decreased by 1.3% to 81 in January from 82.1 in December 2023. A consumer confidence index below 100 indicates negative sentiment towards the economy. The high-interest rates have led to increased living costs, contributing to overall pessimism about the economic outlook. This decrease in consumer confidence may serve as an indicator of the potential for a significant economic downturn in the future.

The unemployment rate in Australia stands at 3.9% as of December, with a reduction of 800 people to a total of 573,600 unemployed individuals. Full-time employment decreased by 7,300, totaling 367,700, while part-time employment increased by 6,500 to 196,700. Rapid job cuts of 65,100 positions occurred primarily in full-time employment, while part-time job opportunities increased.

Job advertisements in Australia increased by 0.1% monthly in December, following a 5.1% decline in the previous month. The rise in interest rates to 4.35% directly impacted the labor market, resulting in a more than 14.9% decline in job advertisements. However, labor market flexibility still allows for sufficient and capable workers to easily transition between jobs.

The value of new home loans in Australia increased by 0.5% monthly to 17.86 billion Australian dollars in November. This increase is attributed to the significant slowdown in residential construction. Existing home purchases and new home constructions have both seen a decrease, contributing to the overall decline in the housing market.

Techical analysis data (5H)

Resistance: 1.5202, 1.5225, 1.5264

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 1.5101 - 1.5139 but cannot break the support at 1.5139, you may set a TP at approximately 1.5225 and SL at around 1.5077 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 1.5202 - 1.5225, you may set a TP at approximately 1.5264 and SL at around 1.5101 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 1.5202 - 1.5225 but cannot break the resistance at 1.5202, you may set a TP at approximately 1.5101 and SL at around 1.5264 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 1.5101 - 1.5139, you may set a TP at approximately 1.5077 and SL at around 1.5225 or according to your acceptable risk.

Pivot point January 23, 2024 05:26 PM. GMT+7