Australian Labor Data supports the Aussie Dollar

Australian dollar gdp, aussieThe AUD/USD Forex market, and the Australian dollar in particular, rose this morning after the July labor sector data was released. The numbers were positive.

Australia added 14,000 positions. This was just shy of the 15,000 that was estimated. Also of consideration, the Australian unemployment rate held steady at 5.6 percent. This was, also, as expected.

This was a strong print for the Australian labor market, and investors cheered the news as it crossed the news wires earlier this morning.

Must of the gains is thanks to strong gains in the full time sector. This sector saw an increase of 62,000 new positions. This print, far outpace losses from the part time sector which saw a loss of 48,000 positions.  To add to investor sentiment, Australia’s labor force participation rate inched higher with this report. The participation rate clocked in at 65 percent. This is its highest level in 1.5 years.

The Australian Jobs Data Supports the AUD

The Reserve Bank of Australia (RBA), is continuing its stance with a neutral monetary policy outlook. The financial markets are, right now, pricing in a better than even chance that the next official cash rate (OCR) hike will happen closer to April 2018. This data will not change the reserve bank’s policy path.  The data also encouraged yield seeking capital flows, this morning. The AUD currency unit was a clear beneficiary.

David Frank

David Frank

Chief Market Strategist at CupO'Forex
David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.
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