February month employment statistics from the Australian Bureau of Statistics, up for publishing at 00:30 GMT on Thursday, will be the immediate catalyst for the AUD/USD pair traders. The figures become all the more important as the Reserve Bank of Australia (RBA) recently conveyed its bearish bias on the jobs figures and the Aussie bulls are currently cheering the Fed’s dovish halt.
Market consensus favors Employment Change to increase marginally to 30.0K from 29.1.0K on a seasonally adjusted basis whereas the Unemployment Rate is likely to ease from 6.4% to 6.3%. Further, the Participation Rate may rise from 66.1% to 66.2%.
TD Securities expect a mixed data while saying,
We are forecasting headline employment to fall by 31k (market forecast: +30k) in Feb, ending 4 consecutive months of employment gains. Our Feb NSA model forecast stands at +170k but after adjusting for seasonals by the same magnitude for Jan'21 over Jan'20, we obtain a -31k SA headline print. Assuming participation rate stays unchanged at 66.1% in Feb, this translates to an uptick in the unemployment rate to 6.6% from 6.4% previously.
Additionally, analysts at Westpac said,
The labor market has had a sharp V-shaped recovery, much stronger than anticipated. However, the state data reveals the impact of further lockdowns, and reopenings, with employment surging in Victoria while it stalled in NSW. In addition, the recovery has been dominated by male part-time employment. Our forecast (also consensus) is for +30k on employment (based on a NSW bounce and a softer Victoria) with a 0.1ppt rise in participation, producing a 0.1ppt fall in unemployment to 6.3%.
How could the data affect AUD/USD?
Given the AUD/USD pair’s latest run-up relying mostly on the Fed’s failure to offer any near-term rate hike signals, coupled with the RBA’s fears of sluggish employment, any disappointment can quickly trim the recent gains. However, the bears aren’t likely to turn hopeful as the RBA has already anticipated and acted over this negative surprise if any.
Technically, A sustained break of a two-week-old falling trend line and 21-day SMA, respectively around 0.7790 and 0.7780, keeps AUD/USD buyers hopeful to refresh the monthly high above 0.7838 currently.
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).
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 labor force. If the rate hikes, indicates a lack of expansion within the Australian labor 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).
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