Forex Flash: Aussie leads the way - BTMU

Derek Halpenny, European Head of Global Markets Research at the Bank of Tokyo Mitsubishi UFJ notes that during another relatively quiet trading session in Asia, it is the Australian dollar that is in the spotlight, advancing by 0.7% against the dollar after much stronger than expected employment data.

He sees that in contrast to the moderate 10k consensus gains in employment, the actual increase reported was 71.5k, the largest monthly increase in nearly thirteen years. He writes, “Most of the jobs were in the part-time sector with an increase of 53.7k. There are some doubts over the statistical methods used to calculate the data and the authorities themselves advise focusing on the trend data which given the weaker data prior shows 12,500 jobs were created on average over the past six months.” However, despite all this, they were still good, but not the stellar figure reported in February alone.

However, he continues to write, “But no doubt the jobs data today clearly reduces the risk of RBA action any time soon. The RBA has recently been expressing optimism that the domestic economy would respond to policy easing already implemented and this report suggests that to be the case. AUD/USD is unlikely to advance on a trend basis from here but equally this report offers decent support on the downside at a time when the dollar is performing well.”