By Chuck Butler
Good day... And a Tub Thumpin' Thursday to you! The daytime temperature reached 49 yesterday... As our little Christine would say... "get the sharts out!" HAHAHA!
Today, we're chock-full-o-stuff to look for, starting with a European Central Bank (ECB) meeting, and going through the morning here in the U.S. there'll be more "stuff" for us to look for, like Retail Sales, and since it's a Thursday, the Weekly Initial Jobless Claims will also print. The Fed's Beige Book printed yesterday afternoon, and we've got that to discuss this morning too... So, let's get this Tub Thumpin' Thursday going, eh?
Front and Center this morning... The Australian Jobs report printed yesterday afternoon, and it looks like we'll be able to put another mark in the "pro" column for an Aussie rate hike in Feb... Here's the skinny... Australian employment soared for a 4th straight month, as jobs created were 3 times more than economists estimated! The total jobs created was 35,200, and the jobless rate fell to 5.5% (from 5.6%)...
So... The economists or "experts" if you will, got this one completely wrong... Their estimate was for jobs created to be 10,000... This is very strong employment growth for Australia, and once again places the spotlight on the Aussie dollar (A$) as one of the best yielding currencies with a prospect of even higher yields as soon as February!
OK... This report doesn't "seal the deal" in any shape or form, but it does "nudge" the Reserve Bank of Australia (RBA) in that general direction, for sure!
Traders took notice, right away, and began buying Aussie dollars, pushing the A$ past 93-cents on the night...
The interest rate spread / yield differential between the U.S. and Australia really was put up on top of the desk and asked to dance when U.S. Fed Head, Dudley, said that short term interest rates may remain low for at least 6 months and "possibly for as long as two years"!
Hmmm... Ok, Dudley said that it all "depended on how the economy develops"... WOW! A new MR. Obvious! No dookie! You mean, the Fed is going to react to how the economy develops? WOW, what a novel idea!
OK... I'm sorry, I got carried away there... Since he mentioned it, we might as well take a look at the Fed's Beige Book that printed yesterday afternoon...
The Fed's Beige Book, which is a report on the pulse of the economy from each Fed region, showed that while the economy is slightly better, it continues to operate below capacity, or in their words... " the economy continues to operate at "low levels"...
The Fed Heads also noted that holiday spending in 2009 was "slightly better than in 2008, but still far below 2007 levels... In fact, it was added that the 2009 improvement was so small it did not really represent a shift in trend...
OK... So... Now, looky here! We have December Retail Sales printing this morning! Front and Center, Retail Sales is expected to rise for this period, by .5%, a moderate rise, and one that's disappointing, I would think, when talking about the month of December! And off quite a bit from November's rise of 1.3%...
