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13/06/24
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AUD Ignores Strong Employment Data
On Thursday, the Australian dollar inched down, and AUD/USD traded at about 0.6674, up 0.14% for the day in the North American session. The currency didn’t react much to today’s strong Australian employment report.
Although Australia’s economy has been easing, the employment report for May showed that the labor market is still strong despite the uncertain economic picture. The economy added 39.7K jobs, higher than April’s revised gain of 37.4K and the market forecast of 30K.
Full-time employment soared with a 41.7K gain, after two consecutive soft months. The unemployment rate dropped from 4.1% to 4.0%.
Thursday’s employment report is the last tier-1 release before the Reserve Bank of Australia’s next meeting on June 14. The RBA has held rates unchanged at 4.35% for 6 consecutive times and will likely hold rates again next week.
The central bank is still worried about inflation, which has proven to be persistent and in April rose unexpectedly from 3.5% to 3.6%.
The Reserve Bank is still hawkish and has said that it would hike rates if inflation continued to increase. Although a rate hike is unlikely, the message from the RBA is that inflation is still too high and rate reductions will be delayed, possibly until early next year.
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