Trading the News: Australia Employment Change
Australia’s Employment report may curb the recent decline in AUD/USD[1] as the economy is anticipated to add another 15.0K jobs in July.
Another positive outcome may spark a bullish reaction in the Australian dollar[2] as it boosts the outlook for growth and inflation, and the Reserve Bank of Australia (RBA) may come under pressure to lift the official cash rate (OCR) off of the record-low as ‘the rate of wages growth appears to have troughed and there are increased reports of skills shortages in some areas.’
As a result, an above-forecast employment report may encourage the RBA to change its tune over the coming months, and Governor Philip Lowe & Co. may adopt a more hawkish tone over the remainder of the year as ‘the central forecast is for inflation to be higher in 2019 and 2020 than it is currently.’
However, a batch of dismal data prints is likely to keep AUD/USD under pressure as it encourages the RBA to retain a wait-and-see approach for monetary policy, with recent price action warning of further losses as it extends the series of lower highs & lows carried over from the previous week. Sign up and join DailyFX Junior Currency Analyst Daniel Dubrovsky LIVE[3] to cover the reaction to Australia’s employment report.
Impact that Australia Employment report has had on AUD/USD during the last print
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