The Australian employment report for January was the highlight of today’s Asian session and produced a strong response to an above-forecast headline.
The Australian economy added a total of 46.3k jobs in January, well above expectations of a mere 10k increase and the AUD responded accordingly with the 40 point jump versus the greenback. However, the details of the report showed that almost all gains were in the part-time sector (recouping the hefty losses in the category in December, which were revised even worse to -59.6k) while only 12.3k full-time jobs were added. Taking December and January’s data together, just over 5k jobs were added per month, hardly the most inspiring of numbers (though some Euro-zone members would love to see such developments!) and the AUDUSD struggled to progress much higher and we consolidated lower for the rest of the session. The participation rate was steady at 65.3 percent with the unemployment rate dipping to 5.1 percent from 5.2 percent.
We also heard final Q4 GDP numbers for Singapore which were revised a touch better but still registered negative growth of 2.5 percent q/q compared to -4.9 percent at the first estimate. For the full year 2011 the economy grew 4.9 percent, slightly higher than the 4.8 percent initial estimate. A surge in biomedical manufacturing output countered weak electronics exports while public sector building projects also supported. The government reiterated its growth forecast of 1-3 percent for 2012 ahead of the Singapore budget tomorrow (from 0730GMT).
A review of Greek headlines overnight showed that news that Eurozone finance ministers are considering delaying all or part of the Greek bailout was enough to pressure the EUR to nine-day lows versus the dollar and instill broader weakness across the board. EU’s Juncker noted that while progress was being made on Greece’s second bailout package, more considerations were needed on concrete ways to measure reform implementation and priority given to debt servicing. Mixed Q4 GDP data from France, Germany and Italy resulted in overall Eurozone growth of -0.3 percent q/q, in line with forecasts.
On the US data front, the empire manufacturing index extended its recent rebound with a push to 19.53 from 13.48, its best reading since June 2010 and well above forecast. In contrast, industrial production was flat in January having chalked up 1.0 percent gains in December while capacity utilisation was quite steady at 78.5 percent from 78.6 percent. The good news continued with the NAHB housing index rallying to 29 from 25 to hit its highest level since May 2007 and giving further indication that the housing sector is stabilising. Despite the good news, Wall St failed to respond and finished the day in the red led by a volatile session for Apple shares.
Data Highlights
US Feb. Empire Manufacturing out at 19.53 vs. 15.0 expected and 13.48 prior
US Dec. Net Long-term TIC Flows out at +$17.9 bln vs. $45.0 bln expected and revised $61.3 bln
US Jan. Industrial Production out at flat m/m vs. +0.7% expected and revised +1.0% prior
US Jan. Capacity Utilization out at 78.5% vs. 78.6% expected and revised 78.6% prior
US Feb. NAHB Housing Market Index out at 29 vs. 26 expected and 25 prior
NZ Jan. Business PMI out at 50.5 vs. revised 51.6 prior
AU Feb. Consumer Inflation Expectation out at 2.5% vs. 2.8% prior
NZ Feb. ANZ Consumer Confidence out at -2.4% m/m vs. 7.1% prior
SI Q4 Final GDP out at -2.5% q/q, +3.6% y/y vs. -2.3%/+4.3% expected and -4.9%/+3.6% prior resp.
UK Jan. Nationwide Consumer Confidence out at 47 vs. 40 expected and 38 prior
AU Jan. Employment Change out at +46.3k vs. +10.0k expected and revised -35.6k prior
AU Jan. Unemployment Rate out at 5.1% vs. 5.3% expected and 5.2% prior
AU Jan. Participation Rate out at 65.3%, as expected vs. 65.2% prior
China Jan. Actual FDI out at -0.3% y/y vs. -12.7% prior
Upcoming Economic Calendar Highlights
(All Times GMT)
Sweden Riksbank Rate Announcement (0830)
Sweden CPI (0830)
Norway Q4 GDP (0900)
CA Int’l Securities Transactions (1330)
CA Manufacturing Sales (1330)
US PPI (1330)
US Initial Jobless Claims (1330)
US Housing Starts (1330)
US Building Permits (1330)
US Fed’s Bernanke to speak (1400)
US Bloomberg Consumer Comfort Index (1445)
US Bloomberg Economic Expectations Index (1445)
US Philadelphia Fed Index (1500)
Andrew Robinson,
SAXO BANK