Overview of the Australian jobs report
Early Thursday markets will see Australian employment data from the Australian Bureau of Statistics at 11:30 Sydney/9:30 Singapore/HK and 01:30 GMT. Having witnessed mixed jobs report in February, followed by the absence of strong optimism towards the employment data in RBA minutes, March month employment change and unemployment rate become crucial for AUD/USD traders.
Market consensus favors an increase to 12.0K from 4.6K of seasonally adjusted employment change whereas the unemployment rate is likely ticking up to 5.0% versus 4.9% prior.
TD Securities expect employment report to follow RBA’s forecast as they said:
"After our “flat” February print materialized (+5k) we look for a 'trend' employment increase of +17k in March. Combined job ads point to ongoing 2¼%/y employment growth. When +17k/m is combined with a likely unchanged participation rate of 65.6%, the unemployment rate could pop back to 5.0%, in line with the RBA projection of 5% over 2019 (mkt 5%)."
Westpac, on the other hand, highlighted the importance of data by being slightly cautious:
"There will be intense interest in Australia’s labour force data (11:30am Syd/9:30am Sing/HK) as the RBA has made clear that an uptrend in the unemployment rate would open the door to a rate cut. After the modest 5k rise in Feb, consensus for Mar is 15k. Westpac looks for 8k. This would keep the annual pace of jobs growth at a firm 2.3%. But if the participation rate remains at 65.6%, this would see the unemployment rate rise to 5.1% from 4.9% in Feb (a low since Mar 2011). Consensus is 5.0%."
How could the data affect AUD/USD?
Even if the Reserve Bank of Australia (RBA) continues to highlight jobs report as an important catalyst driving monetary policy towards normalization, recent mixed numbers have created the troubles to the Aussie central bank.
In light of the latest upbeat China data and brighter prospects of a trade deal between the US and China, positive employment report could help the AUD/USD to extend its north-ward trajectory.
Technically, 0.7195 – 0.7200 area comprising 200-day simple moving average (SMA) holds the gate for the pair’s rise towards short-term descending trend-line near 0.7230 whereas 100-day SMA level of 0.7140 and 50-day SMA level of 0.7110 may entertain sellers during the quote’s pullback.
Key Notes
AUD/USD: Mildly bid around 0.7170 ahead of Australia employment data
AUD/USD Technical Analysis: Aussie erasing Chinese GDP-inspired gains
AUD/USD Analysis: bulls keep trying, but fear prevails
About the Employment Change
The Employment Change released by the Australian Bureau of Statistics is a measure of the change in the number of employed people in Australia. Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth. Therefore, a high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or bearish).
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