Australia shed 4.8K jobs in the month of May, short of expectations for a gain of 10K. In addition, this came on top of a downwards revision from 14.2K to 10.3K in April. And while the unemployment rate remained at 5.8%, this is merely the result of a tick down in the participation rate from 64.7% to 64.6%.
Nevertheless, the Australian dollar seems to be well bid towards the world cup: AUD/USD initially dipped below 0.9350 but recovered within seconds. At the time of writing, the pair is advancing towards 0.94 once again, trading at 0.9387.
The genuinely positive figure in the report comes form full time employment, which rose by 22.2K. So, the job losses come from the drop in part time employment: -27K.
The central bank in Australia would like to see a weaker Aussie, but given the higher yield that the currency offers and a perfect 9As credit rating, yield hungry investors might flock into Australia. We have seen how the expected rate hike in New Zealand boosted the kiwi. What happened to “buy the rumor, sell the fact�
Here is how the AUD/USD looks like:
The 0.94 level works as resistance, followed by 0.9480. For more levels, see the AUSDUD prediction.
