Fundamental: With all but one report for last week, traders will be thankful for the three key surveys expected to be released for this weeks schedule of events, giving the pair a little more activity. Sparking off the action will be the unemployment rate for September. <For Full Story See Below>
Full Story: After forming a textbook double top, the USDHKD currency pair toppled through support figures below the 7.7935 figure before consolidating at the current market price of 7.7836. Now at a pivotal support, dollars bulls may be eyeing the 7.7900 handle should momentum gain steam with a handful of key economic reports on the weeks schedule.
With all but one report for last week, traders will be thankful for the three key surveys expected to be released for this weeks schedule of events, giving the pair a little more activity. Sparking off the action will be the unemployment rate for September. With a consensus of 4.8 percent, market expectations continue to remain optimistic on robust growth still taking place in theHong Kong economy. Declining to 4.8 percent, the unemployment rate beat expectations last month of a 4.9 percent print as the size of the labor force increased by 23,800 workers to a new high of 3.663 million. Attributed to the lower than expected jobless rate, were boosts in hiring from key sectors including construction, business and community services. The lower jobless rate will coincide nicely with a consumer price index that is likely to remain consistent according to consensus estimates. For the month of September, inflationary pressures are likely to rise at an annualized pace of 2.5 percent. Boosted by a rise in the costs of food, utilities and rent, the overall headline figure is moderately higher than most are expecting. For the record, the rate surged to a record pace, increasing at the fastest rate in nearly eight years. However, the core figures, which excludes the volatile food and rent components remained well stabilized and continues to lend to lower inflationary pressures as rent is expected to decline slightly next year. The notion will likely keep central bankers tuned into a more neutral bias, leaving the sentiment on the composite interest rate relatively untouched. A quoted compendium of rates, the composite figure is expected to remain around the 3.05 percent rate as the interbank offer remained stable. However, should time and savings deposits decline once again, the rate may be adversely affected.
Standing as the lone report for the Hong Kong economy, the territorys official foreign currency reserves survey boosted the underlying pair even further into prominence, retaining the seventh place spot among major global economies. Although not necessarily indicative of economic health, the larger amount of reserves further boosted the bond rating improvement that was received last month by Moodys credit rating agency. Rising by $128.9 billion in the last month, Moody increased the countrys A1 rating to an Aa3 rating, the fourth highest investment grade as reserves were built on sound expansion in the economy. The economy continues to boast a budget surplus of $1.8 billion in the current fiscal year. With reserves built to $130.3 billion in the current month, expansion continues to be in the cards for Hong Kong, underpinning currency market strength in the Asian currency.
Economic Releases for October 16 October 23
| Date | Event | GMT | EST | Consensus | Previous |
| 10/17 | Unemployment Rate SA (SEP) | 8:15 | 4:15 | 4.8% | 4.8% |
| 10/19 | Composite Interest Rate (SEP) | 9:00 | 5:00 | -- | 3.05% |
| 10/20 | CPI Composite Index (YoY)(SEP) | 8:15 | 4:15 | 2.5% | 2.5% |
