AUDUSD steady as jobless rate stabilises at record lows

After an impressive rebound over the past three months, Australian Labour Force data released early today has shown the pace of the recovery has slowed to a more sustainable pace in March. 

The Australian economy added 17.9k new jobs in March while the unemployment rate remained stable at 4%. Both were marginally weaker than expectations; however, the unemployment rate has remained at its lowest level since August 2008. 

Reflecting the underlying strength of the labour market, the participation rate was unchanged at 66.4% and at its highest level on record. The underutilisation rate, which includes underemployment, fell to 10.3% from 10.6%, the lowest level since September 2008. 

The continued recovery in the labour market now has the economy at full employment, and a lift in wages growth should follow to above 3% by the second half of 2022. In expectation of this, it should see the RBA begin to raise interest rates by 15bp after the Federal Election in June.

Following a very shallow dip from .7465 to .7445 post the data, the AUDUSD has returned to where it was trading pre the data, trading at .7465.

Technically, preliminary signs of basing in the AUDUSD have emerged after a second consecutive test and rebound from the .7400c support area overnight, suggesting the correction from last week’s post-RBA, .7661 high is nearing completion.

Should the AUDUSD now reclaim resistance at .7500c on a closing basis, it would indicate the uptrend has resumed in line with our medium-term bullish view of the AUDUSD outlined here.  

Source Tradingview. The figures stated are as of April 14th 2022. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation

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