Breaking: Aussie jobs data better than expected, but the caveat is ...

FXStreet Team FXStreet

The Australian March employment data has been released as follows:

Australia March Employment +5.9k s/adj (Reuters poll: -40.0k).
Australia March Unemployment rate +5.2 pct, s/adj (Reuters poll: +5.5).
Australia March Full-time Employment -0.4k s/adj.
Australia March Participation Rate +66.0 pct, s/adj (Reuters poll: +65.9 pct).

The caveat is ...

This data was better than expected, but remember, the survey was conducted in the first two weeks of the month (prior to the introduction of lockdowns and other restrictions). We will not get the brunt of COVID-19's until April's data.

AUD/USD implications

The Aussie dollar hit 1-month highs earlier in the week despite consumer sentiment suffering its largest monthly fall on record in April. It has been closely linked to US equity sentiment, but that now is taking a turn for the worst. With commodities under pressure, the US dollar back in vouge and weakness in key Asian FX barometers such as USDCNH and AUD/JPY, AUD/USD could be destined to deteriorate further from its early March drop and 78.6% Fibonacci highs, eyeing a 23.6% Fibo retracement of the latest bullish stretch to the 0.6220s and support structure.

Dollar Index trades on a solid foot near 99.80

However, dips in AUD could well be offering committed bulls a discount. A supporting factor for AUD is, however, is that the Australians have very successfully managed to contain their COVID-19 spread. This could mean that tapering is on the cards and should the government relax the lockdowns, business activity, in lockstep with its biggest trading partner, China, then this unemployment data will start to improve, in favour of the Aussie. As other nations' COVID-19 crisis peak, one would expect an unwind of US safe haven holdings and a spike in commodities, further supporting the case for higher AUD.

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 indicate 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 daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.