RBA not out of the woods yet

It still seemed clear in the RBA's last statement that it would not cut rates again today's labour market report for September questions this impression. The only reason why the loss of almost 14k full time positions did not lead to a rise in the unemployment rate was that the participation rate eased. 

The RBA is not yet out of the woods. In particular as long as China is struggling, a further rate cut is possible. For that to be the case the Australian economic data would have to deteriorate notably though which we do not expect. 

"The fact that AUD is able to appreciate against USD following the weak labour market report is only due to the market is putting pressure on USD following yesterday's weak US data and the Fed's confusing communication strategy", says Commerzbank.