Breaking: Aussie Employment report is hugly bullish, sends AUD 20 pips higher off the bat

FXStreet Team FXStreet

Australia’s highly anticipated May jobs report is out and smashed expectation as follows, sending the Aussie higher in its correction vs the Fed-hardened greenback:

Australia May Employment +115.2k s/adj (Reuters poll: +30.0k).
Australia May Unemployment Rate +5.1 pct, s/adj (Reuters poll: +5.5).
Australia may Full Time Employment +97.5k s/adj.
Australia May Participation Rate +66.2 pct, s/adj (Reuters poll: +66.1 pct).

The main domestic news event for the Aussie has been jobs data for the month of May, albeit it has been somewhat diluted by the surprise hawkish tilt at the Federal Reserve.

Nevertheless, this will be especially important as it will be the last key release before the 9 July Reserve Bank of Australia meeting and the Aussie has rallied 0.25% off the bat so far, some 20 pips higher.

15-min chart

Traders looking to the RBA

Markets will be looking for changes to the shape and possibly size of the QE after this very strong headline print and a drop in the Unemployment Rate that could lead to a less dovish RBA and a brighter inflation outlook for the second quarter after the underwhelming first quarter print.

Earlier today, RBA's governor Phillip Lowe was speaking:

RBA Lowe: Aussie economy needs stimulus

About the Unemployment Rate

The Unemployment Rate released by the Australian Bureau of Statistics is the number of unemployed workers divided by the total civilian labour force.

If the rate hikes, indicates a lack of expansion within the Australian labour market. As a result, a rise leads to weaken the Australian economy. A decrease of the figure is seen as positive (or bullish) for the AUD, while an increase is seen as negative (or bearish).

Author

FXStreet Team

FXStreet

EUR/USD flirts with weekly lows near 1.1770

EUR/USD now comes under further selling pressure, breaking below the 1.1800 support to challenge the area of weekly throughs near 1.1770 on Thursday. The pair’s decline comes in response to marked gains in the US Dollar amid steady geopolitical tensions. Ealier in the day, the ECB’s Lagarde delivered cautious remarks, although the currency remained apathetic.

GBP/USD threatens the 200-day SMA near 1.3440

GBP/USD rapidly leaves behind Wednesday’s strong advance, coming under heavy pressure and retesting the 1.3440 zone, where the critical 200-day SMA is located. Cable’s deep pullback follows the strong gains in the Greenback, while investors continue to pencil in a potential BoE rate cut in March.

Gold trims gains, slips back to around $5,170

Gold is now facing some downside pressure, hovering around the $5,170 region on Thursday. The yellow metal surrenders part of its earlier gains on the back of the resurgence of the buying interest in the Greenback. In the meantime, geopolitical tensions in the Middle East continue to limit the downside potential for now.