A$ Awaiting Important Data Prints

AUDUSD rose around 0.5c after the US PPI report. It reached 0.676 before moderating to 0.675, where it is currently trading. The DXY was down slightly mainly driven by the JPY but AUD also managed a 0.27% rise to be the fourth best G10 performer versus USD. AUD was steady against its crosses but fell to 95.986 versus the JPY (now 96.53)

• AUDUSD’s bearish theme persists and the upwards correction appears to be done. AUD bounced off its low of 0.6705 at the London start held by the 0.6699 initial support. First resistance point is 0.6846.
• With the small improvement in risk sentiment, oil prices rose around 1.5%, the VIX fell 1.1pp to 26.2% and US equity market rose but Europe was still down. Risk wariness continued in metal markets with copper falling 0.6%. Iron ore recovered to $103 on positive China Covid news.
• Both the MI consumer inflation expectations for September and the August labour force report are likely to be watched closely. As we noted in Petrol Prices Could Impact Upcoming Data Outcomes, inflation expectations could moderate due to the drop in petrol prices. Employment is expected to rise 35k with the unemployment rate steady at 3.4% (see Labour Market Likely Still Strong In August).