If it looks too good to be true, markets probably think it is unreal as well. The Australian government reported a gain of no less than 121,000 jobs in Australia, the best gain on record and far above a gain of 15.2K expected. Also the unemployment rate surprised with a drop from 6.4% to 6.1%, significantly better than 6.1% expected.
Update: Those Australian job gains were indeed too good to be true – AUD/USD slides
The initial response was certainly positive: a jump to 0.9217, but as the hours pass by, the pair is dropping down below 0.92.
According to the details of the report, most of the jobs gained were part time: 106.7K while only 14.3K were full time. The participation rate leaped from 64.8% to 65.2% in another hard-to-believe data point. Also last month’s jump in the unemployment rate to 6.4% was also seen as exaggerated.
The Australia dollar was the last one to surrender of the US dollar. After showing resilience for some time, the pair finally lost the 0.92 level and continued tumbling down.
Despite the doubts surrounding the jobs data, it still provides some support for the A$.
Here is the move on the chart:
For more, see the AUDUSD forecast.
