Photo: Getty/ Justin Sullivan

Australian data is out and it’s a mixed bag showing no inflation, sharply higher building approvals and company profits improving — although down.

Earlier this morning the monthly TD Inflation Gauge was released showing that inflation over August rose just 0.1% versus the 0.5% last month, which pulled the year-on-year rate down to 2.1%.

That is right at the bottom of the Reserve Bank’s target band.

Usually this would be very bullish for interest rates and hurt the Australian dollar. But this has been mitigated by the sharp jump in building approvals, which rose a stunning seasonally-adjusted 10.8% month-on-month in July, for a year-on-year rise of 28.3%.

Company profits were down (seasonally adjusted) but the Australian Bureau of Statistics says:

Company gross operating profits continue to trend upwards despite a seasonally adjusted fall in June

Building Approvals is where the rubber hits the road for monetary policy. And even though the non-seasonally adjusted number was up just 0.9%, seasonal adjustments are what the market and economists rely on to get to the underlying data trends.

So it’s big news for the Aussie Dollar at 0.8966 and the ASX which is at its highest level since May this year near 5180.

Disclosure: Greg McKenna is an active currency trader and is currently short AUD.

Now read: ‘AUSTRALIA IS STUFFED’: What The Victims Of One Of The Nation’s Biggest Tragedies Think Of Tony And Kevin

Follow Business Insider Australia on Facebook and Twitter

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at