Australia: Employment doesn't disappoint the RBA - TDS
Annette Beacher, chief Asia-Pacific macro strategist at TD Securities, suggests that today's Australian March employment report did not feed the doves as the unemployment rate popped back up to 5% as widely anticipated (the 6m average is also 5%, not trending anywhere but sideways).
Key Quotes
“February's +5k was upgraded to +11k; and employment jumped by +26k (mkt +15k, TD +17k) where full-time surged by +48k. The RBA expects the unemployment rate to be 5% this year, so today's report is consistent with that view.”
“The RBA also focuses on underemployment, although in March these measures edged higher. However underemployment and underutilisation rates/ratios have been edging lower (not in a straight line) for the last two years. The underutilisation rate hints at wages growth closer to 2¾% by year end.”
“Despite bearing the weight of rate cuts both offshore and domestically, the AUD cannot sustainably trade through $US0.70, while sellers tend to emerge when trading past $US0.72. This tight range is likely to continue until we have clarity on the outcome of the 18 May election (turning out to be more of a close call than thought a few months ago) and what kind of fiscal stimulus we can expect over the coming year or so (tax cuts vs minimum wage hikes).”
Author
Sandeep Kanihama
FXStreet Contributor
Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.
