AUD: Strong jobs growth but too early to conclude AUD weakening trend is over – MUFG

By FXStreet FXStreet (Delhi) – Derek Halpenny, European Head of GMR at MUFG, notes that their assumption that the Australian dollar would continue to gradually weaken over the coming quarters is in some doubt this morning after the jobs data from Australia came in way stronger than expected.

Key Quotes

“Employment increased by 58,600 in October with 40,000 of those jobs full-time positions. As a result of that the unemployment rate plunged from 6.2% to 5.9%. There has only been one stronger monthly gain in jobs growth (March 2012) since the financial crisis.”

“Two opposing points are worth making here. Firstly, the strength of the report will be a surprise for the RBA. The latest monetary policy statement revealed that the RBA expected the unemployment rate to remain in a 6.0-6.5% range through most of next year. But secondly, the current stance of the RBA (modest bias to ease) exists in the context of knowing the labour market had been improving compared to last year.”

“The RBA is likely to do two things now before jumping to any conclusions. First, it will wait another month to see whether the October gain is reversed and second it will assess other data to see if the …read more

Source:: FX Street