AUS Jobs Data is not as Impressive as the Headline Number Suggests
During the 9/11 Asian session, we got Australia’s jobs data for August. According to the the statistics bureau, the labor market added 121,000 jobs in August, which improved immensely from the -4.1K print from July, and completed eclipsed the forecast around 15.2K. The unemployment rate fell to 6.1% from 6.4% accompanied by an increase of the participation rate to 65.2% from 64.9%.
Before getting too excited for the headlines number, we should note that the increase was due to 14.3K increase in full-time jobs, and 106.7K increase in part-time jobs. The statistics office explained that this was due to a chance in survey sample.
So how should we interpret this data? Well, the sampling variation definitely takes away from the positive data, but we should still consider today’s data as positive, but maybe 10-fold less positive than the 121K reading suggests.
The market was not fooled by the strong print. After an initial bullish reaction, the AUD continued this week’s bearish mode.
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AUD/USD pulled back and found sellers at the previously broken multi-month support at 0.92. Price retreated sharply, and is poised to continue a sharp bearish trend that has the 2014-lowof 0.8660 exposed. A few more strong employment data or the RBA considering rate hikes will be needed to give the AUD reprieve.
The AUD/NZD also rallied after the jobs data but is retreating just as sharply. Note that the 4H RSI stayed below 60, showing maintenance of the bearish momentum in this time-frame. The downside risk remains at last t othe 1.1089 low on the month, and possibly the 1.1051 support/resistance pivot from August.
It should be noted that the NZD was also weaker after the RBNZ held the official cash rate at 3.50% and basically said the currency should be lower. The Kiwi is still weak across the board, so but the Aussie is even weaker at the moment.
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