Australian Dollar Inched Higher After Wage Price Index Released

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The Australian Dollar (AUD) escalates upwards against the New Zealand Dollar (NZD) after stats concerning wage balance released today i-e August 13, 2019. It remained higher than what economists had anticipated. The data tells that the wage price index improved during the last quarter and stayed around 0.6%, as it was 0.5%, the quarter before.

The Wage Price Index released by theĀ Australian Bureau of StatisticsĀ is an indicator of labor cost inflation and of the tightness of labor markets. The Reserve Bank of Australia pays close attention to it when setting interest rates. A high reading is positive (or bullish) for the AUD, while a low reading is seen as negative (or bearish).

The economists also indicated an uprise in the said data by giving a value of 4820 M. It is to be noted that the trade balance represents the difference between import and export levels of the country. Both imports and exports levels stayed in coherence followed by a reasonable domestic demand in terms of imports and an unchanged or improved demand in exchange for exports of the country. So, the pair is believed to start moving positively.

The pair continues sinking since last week, which can be seen in the graph below. It is quite likely that the pair will keep sliding downward until or unless it gets a strong reversal.

 

 

Conclusion

Trading AUDNZD may be a better idea for a short term position. However, it may get a reversal around 1.0510 and start declining again. If this happens, trading the pair for a long term position may be avoided.

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