Major Economic Indicators for Australia

Australia
IndicatorRelease dates
RBA Monetary Policythe first Tuesday of each month
Newly Employed Personsin the middle of each month
Unemployment Ratethe first Friday of each month
Retail Salesthe 9th business day of each month
Consumer Price Indexaround the 20th of each month
Gross Domestic Product (GDP)quarterly
Name of Indicator
RBA Monetary Policy
Release Date
the first Tuesday of each month
Characteristics of Indicators

RBA monetary policy is released by Australia’s central bank, the Reserve Bank of Australia (RBA), which makes decisions on overnight rate at which banks borrow or lend from one another. The RBA sets the inflation target at 2%~3%. The central bank raises interest rate when the inflation rate is high, and lowers the interest rate when the inflation rate drops.

When the economy is growing, investors tend to buy the currency of the country as they think that interest rates will be raised. On the other hand, interest rates tend to be lowered during economic downturns. The Australian dollar is known as a high interest rate currency. Because the changes in interest rates have a great impact on the exchange rates, it is very important to pay attention to the remarks and comments made by the president of the RBA.

Name of Indicator
Consumer Price Index
Release Date
around the 20th of each month
Characteristics of Indicators

Consumer price index is an economic indicator that measures the changes in the retail prices of consumer goods and services actually purchased by consumers. Since it is an important indicator that is closed correlated with the inflation rate, many countries, such as the United States, EU, Japan, China, Australia and emerging countries, pay special attention to this index in the market.

To put it simply, consumer price index indicates price inflation and deflation. If the consumer price index increased dramatically, it is most likely that interest rates will be raised in order to keep the rate of inflation low. As this economic indicator is closely related to the exchange rate volatility, it is necessary to look at the consumer price index while trading.

Name of Indicator
Unemployment Rate
Release Date
the first Friday of each month
Characteristics of Indicators

Unemployment rate is an indicator that shows the percentage of unemployed people in the labor force. The definition of “unemployed people” varies from one country to another. By looking at unemployment rate, one can keep track of the employment situation of the country. It is thus the most important economic indicator that draws the attention of investors. To rank the developed countries in the order of unemployment rate, it is as follows: EU, United States and Japan. Similar to inflation rates, unemployment rate is closely correlated with people’s daily life. It is thus sometimes used for political purposes.

While examining the unemployment rate, there are three statistics that an investor needs to pay attention to: the statistics of the previous month, market forecast prior to the release of unemployment rate, and officially released unemployment rate. Especially, one should look at the market forecast and officially released unemployment rate. If there is a big difference between the released unemployment rate and the market forecast, it is very likely that large movements in the market will occur.

This data is also an important indicator of the performance of a company and sometimes it can influence the monetary policy. In particular, during economic downturns, monetary easing is likely to be carried out immediately after the release of unemployment rate.

Name of Indicator
Retail Sales
Release Date
the 9th business day of each month
Characteristics of Indicators

Retail sales are defined as the sum of retail sales of commodities sold by domestic producers. It is considered as an economic indicator that helps investors to keep track of movements in consumer spending. It also draws the attention of market participants as it is used to compute GDP. In addition, it is adopted by the FRB to predict economic trends. The monthly retail sales can be revised substantially. Therefore, in addition to the latest data, it is also important to examine the release in the previous month.

To put it simply, retail sales are an indicator that shows how much consumers are spending on goods. Investors pay attention to this indicator in order to have a sense of the economic performance of the country. Because the data are collected on a monthly basis, it is necessary to compare with the data released in the previous month and examine monthly percent changes. This is important for investors to forecast trends in exchange rate.

Name of Indicator
Gross Domestic Product (GDP)
Release Date
quarterly
Characteristics of Indicators

Gross domestic product (GDP) is the sum of the gross value added of domestic production of goods and services within a specific period of time. It is considered as an important indicator of economic growth and production activity in long-term trends. The advanced GDP estimates, as well as the preliminary and final GDP estimates, are released at the end of the month after each quarter ends. It draws the attention of investors as it is the broadest indicator of economic activities and it measures the overall economic performance of the country.

Compared with the previous data, we examine whether there is an increase or decrease in the GDP growth rate to evaluate the economic performance of the country. Investors are more focused on advanced estimates and they examine the personal consumption expenditures, residential investment, fixed investment, inventory investment, and government consumption expenditures and gross investment. As it is a comprehensive indication of the overall growth rate of a country, it is very important for investors to pay attention to this economic indicator.

Name of Indicator
Newly Employed Persons
Release Date
in the middle of each month
Characteristics of Indicators

Newly employed persons are an indicator that shows the number of newly employed people in a month. As one of the employment statistics, it is released, together with unemployment rate, by the Australian Bureau of Statistics. Similar to the U.S. employment statistics, this economic indicator has a large impact on the exchange rate and it draws the attention of investors.

Why do employment statistics have a great impact on the movements of exchange rate? This is because that employment is directly related to personal consumption. If the number of employed people in the labor force falls, the unemployment rate will rise and personal spending will drop. This will lead to economic downturns and investors tend to sell the currency of the country.

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